RI to tender Makassar blocks

RI to tender Makassar blocks

SINGAPORE (Dow Jones): Indonesia intends to announce terms and conditions for six deepwater oil and gas exploration blocks by early January, a source at Indonesia's Ministry of Mines and Energy told Dow Jones Newswires Wednesday.

The blocks are located in the Makassar Strait, off Kalimantan, in water depths of over 1,000 meters, the official said.

The contractor's share of production from the blocks may reach 35 percent, under Indonesia's new incentive system, he said.

The Ministry has already conducted two- and three-dimensional seismic surveys of the blocks, the official said, adding that the blocks are near existing oil and gas fields operated by Unocal Corp. and Totalfina Elf S.A.'s subsidiary Total Indonesie.

Any gas production from the fields could also feed a liquefied natural gas plant at Bontang, in East Kalimantan, he said.

Both Total and Unocal have expressed interest in the blocks, he said.

State-owned oil and gas company Pertamina will invite bids for the blocks. The bidding period will remain open for about six months, he said.