New agency takes over Pertamina's role
New agency takes over Pertamina's role
The Jakarta Post, Jakarta
The government officially launched on Monday the Implementing
Body, the highest authority in the oil and gas upstream sector
and installed director general of oil and gas Rachmat Sudibyo as
its first chairman.
Rachmat was installed as chairman on Monday morning by
Minister of Energy and Mineral Resources Purnomo Yusgiantoro.
Rachmat will retain his position as director general of oil
and gas at the ministry until the government appoints a
replacement, according to Purnomo.
The Implementing Body, which is more commonly known by the
acronym Balak, took over the decades-long monopoly held by state
oil and gas company Pertamina over the country's upstream sector.
It will perform various functions previously carried out by
Pertamina, including the signing of exploration and production
contracts with production sharing contractors, supervising the
upstream sector and regulating the sector.
The establishment of Balak is stipulated in Law No. 22/2001 on
oil and gas which aims to liberalize the country's oil and gas
sector, strip Pertamina of its monopoly and turn it into a common
company like other oil and gas contractors operating in the
country.
Rachmat will take up his office at Patra Jasa building on Jl.
Gatot Subroto, South Jakarta and lead 300 former employees of
Pertamina's special directorate for the supervision of production
sharing contractors.
This directorate was dissolved following the establishment of
Balak and all its workers were transferred to Balak, where, after
one year, they will be asked to choose whether to continue
working at the new agency or return to Pertamina.
Rachmat said the first task to be preformed by Balak was to
officially take over the Coastal Plains Pekanbaru (CPP) block in
Riau from American oil and gas company PT Caltex Pacific
Indonesia on Tuesday following the expiration of its contract.
On behalf of the government, Rachmat will also officially
transfer the block to a joint venture owned by Pertamina and the
Riau provincial administration.
The CPP block currently produces around 70,000 barrels per
day.