|
Indonesia, the world's second largest liquefied natural gas
(LNG) exporter, is demanding Total E&P provide a more favorable
production split should the Paris-based oil giant want the extension a
contract to drill for gas in the Mahakam block in East Kalimantan, an
official says.
Under the current production-sharing agreement, Total and its partner
Inpex Holding Inc., Japan's largest oil and gas firm, get 30 percent of
the gas output and the state gets 70 percent. Total and Inpex each hold
50 percent shares in the block.
The current contract ends in 2017, and if Total wants to seek an
extension, as it has said it does several times, the government would
ask for a greater portion, said Energy and Mineral Resources Purnomo
Yusgiantoro on Tuesday.
"We just want better terms to result from the negotiation to extend the
contract," Purnomo said.
In addition to a better split, the government wants also the operators
to give some of its stake in the block to local government and
state-owned oil and gas company Pertamina, Purnomo said.
The government is considering formulating a regulation that will allow
Pertamina to buy as much 15 percent in a new drilling contract, or in a
contract extension.
When contacted, Ananda Idris, Total's corporate communications manager,
refused to comment, saying only that the discussion was still underway.
Total is seeking to extend the existing contract for up to 15 years
until 2032 to tap remaining reserves in the block located, in the
Mahakam delta.
In March, Total president director Philippe Armand said the company had
submitted a technical outlook for the area including output and
spending plans -- a requirement to start talks with the government.
Purnomo said that in order to get a contract extension, the operators
should also submit a list of its LNG buyers.
An extension in the contract will enable the operators to invest US$8
billion to tap the estimated 13 trillion cubic feet of remaining gas
reserves.
Indonesia accounts for 8 percent of Total's global oil and gas output.
|
