Pertamina awaiting Habibie's decision

JAKARTA (JP): State oil and gas company Pertamina said on Friday it was awaiting President B.J. Habibie's decision on the development of the Coastal Plains Pekanbaru (CPP) block in Riau after 2001.

Pertamina's exploration and development director Priyambodo Mulyosudirjo said the final decision would rest with the President.

The CPP block is currently being developed by PT Caltex Pacific Indonesia (CPI) with an output of 77,000 barrels per day. Caltex's contract on the block will expire in August 2001.

"It was then president Soeharto who decided to transfer the development of the block to Pertamina (last year). Thus, if there is now a different policy regarding the block, we can't accept it until it is approved by the President," Priyambodo said.

A crossministerial task force -- composed of officials from the ministries of mines and energy, finance, state secretariat and national development planning -- recommended last week that the block be jointly developed by Pertamina and Caltex after 2001.

The team also recommended that Caltex and Pertamina take equal stakes in the CPP block joint venture.

It also advised the government to increase its share in the block's oil wells -- which are developed with primary technology and secondary enhanced oil recovery (EOR) technology -- from its present 85 percent.

Minister of Mines and Energy Kuntoro Mangkusubroto suggested last week that he would endorse the recommendation.

Kuntoro said: "Why would you bother setting up a team if you won't take its advice?"

He added, however, that he would consult with Habibie and the House of Representatives' Commission V for mines and energy, industry and trade, cooperatives, investment, manpower, environment on the team's recommendation.

Priyambodo argues that the right to make final decision on who will develop the block lies with Habibie, not Kuntoro.

Jointly owned by giant U.S. oil companies Chevron Asiatic Ltd and Texaco Overseas Petroleum, Caltex has pushed for years to extend its contract on the block for a further 20 years, but Soeharto decided last year to transfer exploitation of the block to Pertamina after the contract ends.

BHabibie's administration opted to review the decision given Pertamina's financial woes. (jsk)