The Tuna Block Super Jumbo gas shares are controlled by Zarubezhneft Rusia

 

    Indonesia's upstream oil and gas authorities no longer have to worry about replacing ZN Asia Ltd, a subsidiary of Russia's Zarubezhneft (ZN). 

As a subsidiary of the Russian state-owned enterprise Zarubezhneft (ZN) currently holds 50% of the participation shares in the Tuna Block. 

The Tuna Block Super Jumbo gas

    The number of foreign investors' Interest in this work area makes the Indonesian government optimistic that it can spur further development.

    The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) is optimistic that the process of transferring participation shareholders of ZN Asia Ltd. in The Tuna Block could be completed this year. Because of the potential for large amounts of hydrocarbons in it, it can be produced immediately and put into lifting Indonesia.

Blogger Agus Purnomo in SKK Migas

    The development of the Tuna Block faced obstacles after several European Union countries and the UK imposed sanctions on Russia as a result of geopolitical tensions in Ukraine. In the Tuna Block, ZN Asia Ltd. partnered with Premier Oil Tuna BV which is part of the Harbor Energy Group, a British oil and gas company.

BP

    In the Tuna Block, Premier Oil Tuna BV also holds 50% participating shares, as well as being the operator carrying out exploration and exploitation activities of oil and gas reserves.

    Nanang Abdul Manaf, Deputy Head of SKK Migas said that up to now his company has gathered many companies that stated his interest in replacing ZN Asia Ltd. in the Tuna Block. Several companies that have expressed interest are Petroliam Indonesia Berhad Petronas Malaysia and Mubadala Energy.

    The hope is that the process of transferring ZN Asia Ltd's participation shares will be successful. can be decided immediately so that the development of the work area is estimated to be capable Flowing gas up to 150 million standard cubic feet per day (MMscfd) can be done.

    The polemic that occurred in the Tuna Block made the Harbor Energy project that the final Investment Decision (FID) for its development would take place in 2025. In fact, approval for the first Plan of Development (PoD) for the field was given on December 23, 2022. 

    Zarubezhneft (ZN) received assurance of replacing ZN Asia Ltd. Harbor Energy Chief Executive Officer Linda Z. Cook once emphasized that the company's oil and gas portfolio in Indonesia, including the Tuna Block, is still a priority for corporate investment abroad. 

    This commitment was proven by the company by drilling four exploration wells in the Andaman Sea, another oil and gas working area in Indonesia managed by the company.

    The Indonesian oil and gas authority projects a state revenue of IDR 18.4 trillion from the management of the Tuna Block. This figure is higher than the potential The income that Premier Oil Tuna BV can obtain as a cooperation contract contractor is worth IDR 11.4 trillion.

    The Tuna Block is actually one of the Indonesian Government's hopes for increasing Indonesia's natural gas production. Minister of Energy and Resources Minerals (ESDM) Arifin Tasrif said that gas originating from the working area will be exported to Vietnam in 2026.

    Gas exports to Vietnam are considered more profitable because the geographical location of the Tuna Block is closer to Vietnam, making development possible Undersea pipelines such as the Nord Stream gas pipeline can directly distribute gas to mainland Vietnam.

    In terms of investment, the development of the Tuna Block up to the operational stage is estimated to reach US$ 3.07 billion. The estimate includes investments beyond sunk costs of US$1.05 billion, investments related to operating costs up to the economic limit of US$2.02 billion, and abandonment and site restoration costs (ASR) of US$147.59 million.

    Chairman of the Investment Committee of the Association of Oil and Gas Companies, Moshe Rizal, believes that European Union and British sanctions could have a serious impact on plan Tuna Block development. Premier Oil and ZN Asia Ltd. need to immediately take strategic steps so as not to hinder the continuity of its business in Indonesia.

    Moshe said that the government together with SKK Migas must also immediately provide a way out of the deadlock on cooperation commitments. The reason is that the sanctions imposed by the European Union and the UK have the potential to delay the development of the super jumbo oil and gas field.

    The desire to immediately resolve the problems in the Tuna Block also came from the Ministry of Energy and Mineral Resources, which hopes that Premier Oil Tuna BV's partners will be replaced soon.

    Director General of Oil and Gas at the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that data regarding the investment potential and details of the Tuna Block had been opened. Several International companies have expressed interest in investing in the Tuna block, but the government still needs to carry out further studies.

    According to him, the replacement of ZN Asia Ltd. in the Tuna Block is very urgent because Premier Oil cannot continue to invest all of its investment in developing the work area itself. After all, it could disrupt the company's cash flow and could go bankrupt.

    The Tuna Block does have a strategic role because it is located in the North Natuna Sea which directly borders Vietnam, a world geopolitical hot spot. In 2021, it was widely reported that the Chinese government was protesting the Indonesian government over oil and gas drilling activities in the sea of Natuna, even though The Jumbo oil and gas block is still Indonesian territory, and mainland China is too far from the Tuna block.

    In fact, in the Tuna Block, 2D and 3D seismic acquisition activities have been carried out, drilling of four exploration wells, namely the Gajali gas well, North Sea-1 gas well, and Belut Laut-1 gas well in 2011, as well as Sea Horse-1 gas well and Sea Lion-1 gas well in 2014.

    The discovery of hydrocarbon reserves in the Kuda Laut-1 and Sea Lion-1 wells, which are structurally adjacent, was later named the Tuna field, with resources of 104 million barrels of oil equivalent (MMBOE).

    These resources are dominated by natural gas reserves with high condensate content, with a CO2 content of less than 2%. Then, in 2021, potential reserves in the Tuna Block were confirmed again through drilling activities for two Delineation wells Sea Lion (SL)-2 and  Sea Horse (KL)-2.

Overcoming oil and gas BIG challenges in Indonesia

    The allure of upstream oil and gas investment in the country is increasingly attractive, as reflected in the commitment of a number of Cooperation Contract Contractors (KKKS) to continue investing in exploration activities.

    A number of global oil and gas giants have also agreed to achieve a large target of oil production of 1 million barrels per day (BPD) and gas of 12 billion standard cubic feet per day (BSCFD) by 2030.

    Through the signing of the Bali Commitment which was carried out at the CEO Forum at the 2023 International Convention on Indonesian Upstream Oil and Gas at the Bali Nusa Dua Convention Center, Badung Regency, Bali, Thursday, September 21. 

    The KKKS CEOs also promised to prepare a massive 2024 work program and budget, aggressive, and efficient. According to reviews by CEOs of international and national oil and gas companies, Indonesia is still an important portfolio. 

ENI ITALY

    Starting from oil and gas companies from Italy, namely ENI, ExxonMobil (United States), Petroliam Nasional Berhad or Petronas (Malaysia), Repsol SA (Spain), British Petroleum (England), to PT Medco Energi Internasional Tbk, and PT Pertamina ( Persero) invests more heavily in the oil and gas sector.

Roberto Daniele

    Director of ENI Muara Bakau BV, Roberto Daniele, said he was serious about investing more intensively in the exploration side of oil and gas fields. Currently, ENI together with PT Pertamina (Persero) have established strategic cooperation to carry out joint exploration in the Mahakam Block. 

the Mahakam Block

This collaboration is expected to increase oil and gas reserves. Roberto Daniele said ENI Muara Bakau BV is collaborating with Pertamina to explore the oil block in Mahakam to look for other oil and gas sources throughout Indonesia.

    Apart from that, ENI will also carry out more massive drilling for wells and exploration in the next 4 years. According to Roberto Daniele, this commitment shows Indonesia's important position in the company's portfolio. 

    Moreover, Indonesia still has large oil and gas reserves. Based on records from the Ministry of Energy and Mineral Resources, Indonesia's proven natural gas reserves even reach 41.62 trillion cubic feet (TCF). Apart from that, Indonesia still has 68 potential basins that have not been explored.

Carole Gall

    President of ExxonMobil Indonesia Carole Gall said that Indonesia has all the segments that ExxonMobil must offer. We have upstream and downstream such as fuel, lubricants, chemicals, and energy transition. Of all the Exxon affiliates in the world, it is rare to have all segments in one place together, but Indonesia has it all. 

    It is not surprising that ExxonMobil remains committed to continuing exploration investments in a number of fields and open areas. Carole Gall said ExxonMobil would drill again in Banyu Urip for 1.5 years.

    Nevertheless, a number of problems still confront the national upstream oil and gas industry, at least There are a number of crucial things that investors should note, including contract certainty, competitive and durable regulations, and ease of investing. 

    The Indonesian government is asked to increase the competitiveness of investment in upstream oil and gas by improving a number of fiscal and non-fiscal policies at a time of increasingly tight competition with a number of countries.

    In accordance with the above, Carole Gall asked the Indonesian government to improve the terms and conditions of upstream oil and gas, especially related to the terms and procedures for procurement of goods and services and auctions for oil and gas projects after approval of the Plan of Development/PoD for oil and gas fields have been obtained by the contractor. 

    According to Carole Gall, the process of procuring goods or auctioning oil and gas projects that is too long makes the return on investment and sustainability of the project unattractive for investors.

    Similar complaints were also made by other KKKS, including Petronas. This oil and gas company from Malaysia highlights the issue of certainty in contracts and fiscal terms in the oil and gas industry. 

Yuzaini Bin Md Yusof

    Petronas will support the Indonesian government to produce 1 million barrels of oil. Petronas Indonesia CEO Yuzaini Bin Md Yusof said Petronas would explore new areas in Indonesia.

INVESTMENT OPPORTUNITIES

Blogger Agus Purnomo in SKK MIGAS

    Meanwhile, Dwi Soetjipto, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK MIGAS), emphasized that Indonesia continues to Offer investment opportunities in the oil and gas sector and is ready to improve fiscal policy and provide various incentives. 

    Dwi Soetjipto said that in overcoming the energy trilemma, a broader collaborative effort is needed between the government, IOC, NOC, and policymakers, namely the Indonesian government. In line with this, investment support is needed so that exploration and development activities for oil and gas fields can be carried out on a massive scale.

    Responding to various input and complaints submitted by energy observer investors and founder of the ReforMiner Institute, Pri Agung Rakhmanto assessed the need for regulations regarding the latest time limit from processing to reaching the PoD approval decision. Pri Agung Rakhmanto said that the longer it takes, the relative economic value will decrease, and also increase the uncertainty factor if there is no decision immediately.

    Meanwhile, based on SKK MIGAS calculations, the oil and gas sector requires a very large investment of more than US$ 20 billion per year to support the 2030 oil and gas production target. Overall, the funding requirement reaches at least US$ 186.7 billion. to be able to achieve the oil production target of 1 million BOPD and natural gas 12 BCSFD by 2030.

Bisnis Indonesia ,Page-4-Saturday, Sept 23, 2023

Pertamina and Petronas Acquire 35 Percent Ownership of Shell in the Masela Block

 Pertamina and Petronas Acquire 35 Percent Ownership of Shell in the Masela Block

    President Director of PT Pertamina Hulu Energi (PHE) Wiko Migantoro signed a Purchase Agreement for the Ownership of the Masela Block. PHE in collaboration with Petronas acquired Shell's 35% ownership in the block. At the same time, Pertamina Main Director Nicke Widyawati signed an MoU Strategic Partnership for Masela Block Development with Inpex.

    The two signings were carried out at the opening of the Indonesian Petroleum Association (IPA) Convention & Exhibition held at the International Conference and Exhibition Center (ICE), BSD, Tangerang, Banten, Tuesday (25/7/2023).

    PT Pertamina (Persero) through Subholding Upstream PT Pertamina Hulu Energi (PHE) signed a sale and purchase agreement for the acquisition of ownership of Shell Upstream Overseas Services (I) Limited (SUOS) in the Masela Block. In this case, PHE is working with PETRONAS through PETRONAS Masela Sdn. Bhd. (PETRONAS Masela) took over 35 percent ownership of SUOS in the block.

    PHE will manage 20 percent of the ownership, while the remaining 15 percent will be managed by PETRONAS Masela because Shell does not have the money to carry out oil and gas exploration in the Masela block. 

    The signing of the sale and purchase agreement for ownership of the Masela Block was carried out by PHE Main Director Wiko Migantoro, Deputy Executive President and Chief Executive Officer of PETRONAS Upstream Datuk Adif Zulkifli, as well as Director of Finance for Acquisition Divestment and NBD Asia Pacific Shell Kuo Tong Soo. 

    The signing was carried out at the opening ceremony of the Indonesia Petroleum Association (IPA) Convention in Tangerang, Banten, Tuesday (25/7/2023).

    The event was witnessed by Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif, Director General (Dirjen) of Oil and Gas (Migas) Tutuka Ariadji, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Dwi Soetjipto, Main Director of Pertamina Nicke Widyawati, and President and Chief Executive Officer of the PETRONAS Group Tan Sri Tengku Muhammad Taufik.

    President Director (Director) of Pertamina Nicke Widyawati said that a commitment to maintaining oil and gas supplies from the upstream side was needed to meet national energy needs.

    PHE as Pertamina's Upstream Subholding has long experience in deep-sea oil and gas exploration, development, and production activities, both in Indonesia and abroad.

    In addition, PHE through one of its subsidiaries also has proven experience in the development and operation of the Badak Liquefied Natural Gas (LNG) Refinery as well as domestic and international LNG marketing. Nicke said PHE's capability and reliability were strong evidence that Pertamina as a State-Owned Enterprise (BUMN) could build cooperation with global partners.

Nicke Widyawati

    In addition, Nicke Widyawati said the Masela Block Abadi Field would potentially require 10,000 workers in the future. The development of the Masela Block is expected to help accelerate the development of local areas so that it can create new jobs and can require a lot of local workers.

    This development is also expected to have a direct impact on economic development in the Eastern Indonesia region. Pertamina as a leader in the field of energy transition is committed to supporting the Net Zero Emissions 2060 target by continuing to encourage programs that have a direct impact on the achievement of the Sustainable Development Goals (SDGs). 

    All of these efforts are in line with the implementation of environmental, social, and governance (ESG) in all of Pertamina's business lines and operations.

Nicke Widyawati

    President Director of PT Pertamina Hulu Energi (PHE) Wiko Migantoro signed a Purchase Agreement for the Ownership of the Masela Block. PHE in collaboration with Petronas acquired Shell's 35% ownership in the block. At the same time, Pertamina Main Director Nicke Widyawati signed an MoU Strategic Partnership for Masela Block Development with Inpex.

    The two signings were carried out at the opening of the Indonesian Petroleum Association (IPA) Convention & Exhibition held at the International Conference and Exhibition Center (ICE), BSD, Tangerang, Banten, Tuesday (25/7/2023).

    PT Pertamina (Persero) through Subholding Upstream PT Pertamina Hulu Energi (PHE) signed a sale and purchase agreement for the acquisition of ownership of Shell Upstream Overseas Services (I) Limited (SUOS) in the Masela Block. In this case, PHE is working with PETRONAS through PETRONAS Masela Sdn. Bhd. (PETRONAS Masela) took over 35 percent ownership of SUOS in the block.

    PHE will manage 20 percent of the ownership, while the remaining 15 percent will be managed by PETRONAS Masela because Shell does not have the money to carry out oil and gas exploration in the Masela block. The signing of the sale and purchase agreement for ownership of the Masela Block was carried out by PHE Main Director Wiko Migantoro, Deputy Executive President and Chief Executive Officer of PETRONAS Upstream Datuk Adif Zulkifli, as well as Director of Finance for Acquisition Divestment and NBD Asia Pacific Shell Kuo Tong Soo. 

    The signing was carried out at the opening ceremony of the Indonesia Petroleum Association (IPA) Convention in Tangerang, Banten, Tuesday (25/7/2023).

The event was witnessed by Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif, Director General (Dirjen) of Oil and Gas (Migas) Tutuka Ariadji, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Dwi Soetjipto, Main Director of Pertamina Nicke Widyawati, and President and Chief Executive Officer of the PETRONAS Group Tan Sri Tengku Muhammad Taufik.

    President Director (Director) of Pertamina Nicke Widyawati said that a commitment to maintaining oil and gas supplies from the upstream side was needed to meet national energy needs.

    PHE as Pertamina's Upstream Subholding has long experience in deep-sea oil and gas exploration, development, and production activities, both in Indonesia and abroad.

    In addition, PHE through one of its subsidiaries also has proven experience in the development and operation of the Badak Liquefied Natural Gas (LNG) Refinery as well as domestic and international LNG marketing. Nicke said PHE's capability and reliability were strong evidence that Pertamina as a State-Owned Enterprise (BUMN) could build cooperation with global partners.

    In addition, Nicke Widyawati said the Masela Block Abadi Field would potentially require 10,000 workers in the future. The development of the Masela Block is expected to help accelerate the development of local areas so that it can create new jobs and can require a lot of local workers.

    This development is also expected to have a direct impact on economic development in the Eastern Indonesia region. Pertamina as a leader in the field of energy transition is committed to supporting the Net Zero Emissions 2060 target by continuing to encourage programs that have a direct impact on the achievement of the Sustainable Development Goals (SDGs). 

    All of these efforts are in line with the implementation of environmental, social, and governance (ESG) in all of Pertamina's business lines and operations.

Minister EMR in Jakarta: sHELL ran away from the Masela Block Irresponsible

    The Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif was very angry with the behavior of the British oil company sHELL. As of today, sHELL does not want to release its 35% participating interest (PI) shares in the Masela Block.

    sHELL has declared that it has run away from working on an oil and gas mining project in the Masela Block. With the PI not being released, the project has been stuck to this day and is very detrimental to Indonesia. 

    Even though Inpex Japan is very interested and able to work on this jumbo project.

    The Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif was very angry with the behavior of the British oil company, sHELL. The reason is, to this day the company does not want to release its participating interest (PI) in the Masela Block.

    Arifin said that because of Shell's actions, Indonesia felt disadvantaged, because if the oil and gas mining project in the Masela Block was carried out, it would produce gas of 1,600 million standard cubic feet per day (MMSCFD) or the equivalent of 9.5 million tonnes of LNG per year (MTPA) and pipeline gas of 150 MMSCFD, as well as 35,000 barrels of oil per day.

The Masela Block

    The Masela Block is being worked on by a Japanese company, namely Inpex Corporation as the operator with a 65 percent stake and the remaining 35 percent is held by Shell Upstream Overseas Services. Everything should be handed over to Japan because sHELL is just playing around and not being serious.

    Arifin continued, if by 2024 there is no activity in the Masela Block, then the government will take over the Abadi gas field development project. 

    This is based on the provisions in the Masela Block development plan or Plan of Development (PoD).

    The Masela block is an oil and gas mine located in the Aru Sea and has been explored since 1998. This project requires a very large capital expenditure (capex), estimated at US$ 20 billion. So it will be difficult if a single investor develops this block without a shareholder partner.

    The Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan said PT Pertamina (Persero) had now agreed to form a consortium to run the oil and gas project to replace sHELL.

Petronas

    The Masela Block has been finalized with Petronas. So SKK Migas has discussed the deal with Petronas, if the price is right, give it immediately, this year it can be done," said Luhut.

Blogger Agus Purnomo in SKK Migas

    Luhut also explained that there were no problems with the process of purchasing Shell's participating interest (PI), it's just that the price bidding process at the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) took a long time because Shell tried to extort Indonesia.

Petronas Interested in Working on the Masela Block

    The Special Task Force for Upstream Oil and Gas Activities (SKK Migas) stated that a Malaysian oil and gas company, Petronas, expressed interest in working on the Masela Block, replacing Shell, which had left the largest gas project in Indonesia.

Petronas

    Petronas is also interested in entering into cooperation with Pertamina in terms of replacing Shell if possible. This is the latest development regarding Shell," said Head of SKK Migas Dwi Soetjipto in a hearing with Commission VII.

The Masela Block

    Apart from Petronas, previously there were two companies that were known to be interested in replacing Shell in acquiring a 35% stake in the Masela Block, namely Pertamina and ExxonMobil. Dwi said Pertamina had opened the Masela Block data room this November. It is hoped that Pertamina can submit a Non-Binding Offer to Shell.

ExxonMobil

    The government is targeting that discussions on the acquisition of Shell's participating interest (PI) in the Masela Block by Pertamina can be completed this year. One of the main conditions for reaching an agreement is the certainty of PI's acquisition value. According to Dwi, Pertamina must find an agreement with Shell to get into the Masela project.

Shell

    According to Dwi, Shell already has a minimum value base that must be prepared by Pertamina. This value is the total funds that have been spent by the company while being Inpex's partner in Masela.

Blogger Agus Purnomo in SKK Migas

"Pertamina is negotiating with Shell. SKK Migas monitors and provides direction so that Shell sells at moderate prices. To keep the project going. We wrote to Shell to support the divestment. Around US$1.4 billion has been spent by Shell," Dwi said.

Inpex Corporation

    Meanwhile, for Pertamina, there is ExxonMobil which was also offered by Inpex to conduct the study. SKK Migas said Dwi hopes that there will be opportunities for cooperation between Pertamina and ExxonMobil to open again, instead of the scent of competition. However, it all comes back to the management of each company whether to continue the collaboration as it has been in the Cepu block.

"If all this time ExxonMobil is also conducting studies, it could be a potential collaboration with Pertamina. But we'll see now that each study has its results, whether we want to continue or not," said Dwi.

IDD Project

    Meanwhile, Dwi also stated that the Indonesia Deepwater Development (IDD) project is expected to start running in early 2023, due to the certainty that the replacement operator for PT Chevron Pacific Indonesia will be completed by the end of this year.

Chevron

“Chevron has decided to leave the IDD project. Now there is a potential replacement. IDD could run next year," said Dwi.

ENI

    According to information, an Italian oil and gas company, ENI, is rumored to be controlling 62% of Chevron Pacific Indonesia's (CPI) participating interest in the Indonesia Deepwater Development (IDD) Gas Project. The IDD project has the potential to produce up to 844 million standard cubic feet of gas per day (MMscfd) and 27,000 barrels of oil per day (BOPD). The plan is for the project to be targeted onstream in the fourth quarter of 2027.

Investor Daily, Page-4, Thursday, Nov 17, 2022

Petronas Becomes Pertamina's New Competitor in the Masela Block

    The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) said that a new competitor in the takeover of Shell Upstream Overseas Ltd.'s 35% stake has decided to leave the Masela Block.

Petronas

    The presence of Petronas has increased the number of potential investors in the Masela Block. Because, previously, Pertamina-INA-Medco and ExxonMobil were reportedly interested in taking over Shell shares. Deputy Head of SKK Migas Fatar Yani Abdurrahman revealed that Petronas has just expressed its interest in replacing Shell in the Masela Block.

the Masela Block

"After someone made an offer, Petronas was interested in joining, but we are currently studying it. We will discuss this," said Fatar.

    Currently, Petronas is only waiting for the government's commitment. However, SKK Migas cannot confirm whether Petronas will enter with partners or alone. What is certain, "Petronas has expressed its interest in investing in this LNG project with a capacity of 9.5 million tons per year," said Fajar.

Blogger Agus Purnomo in SKK Migas

    SKK Migas previously targeted Pertamina to submit an offer to Shell for the acquisition of a 35% stake in the Masela Block this November.

    Until now, the filing of this interest has not been carried out. Pertamina's consortium is currently still being evaluated with various options.

    Potential replacement investors for Shell in the Masela Block must invest around US$ 1.4 billion if they are interested in taking over shell shares. The amount of this investment does not include the funding requirement of US$ 6.3 billion for the first five years of development as capital expenditure.

    In addition, with the addition of the Carbon Capture Utilization & Storage (CCUS) project to the Masela project, there is a potential for additional investment of around US$ 1.2 billion to US$ 1.4 billion.

    Fatar emphasized that learning from Shell's release in the Masela Project, SKK Migas is prepared to strengthen the existing provisions in the future oil and gas block Plan of Development (PoD).

sHell

    Fatar revealed that SKK Migas felt like it had been lied to by Shell leaving the Masela Block. Moreover, "When the POD, we provide incentives, but the conditions are poor. For example, until the commercial production is not allowed to leave the Masela Block," said Fatar.

    The Masela Block project is the first very large-scale project in Indonesia. This also makes the government happy. But unfortunately in the terms and conditions of the contract, there is no protection for the project so that investors don't just run away.

    So, in the future, SKK Migas is targeting regulations to provide protection so that investors do not leave the project until the commercial production stage. This provision applies to projects that receive incentives. As a result of Shell's escape, the construction and development of the Masela Block was delayed. Moreover, the release of management shares or Shell's participating interest requires approximately 18 months for a 35% stake in the Masela Block.

Kontan, Page-12, Wednesday, Nov 16, 2022

Phase II Oil and Gas Working Area Auction Brings US$ 14 Million Investment

    A total of four Working Areas (WA/WK) were offered in the Phase II Oil and Gas Block Auction which was held in 2021, all of which attracted investors, and resulted in an investment commitment of US$ 14.14 million and a Signature Bonus of US$ 1.2 million.

BP

    Director-General of Oil and Gas at the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that the working area auctioned, namely the North Ketapang Working Area, was won by Petronas Carigali Ketapang II Ltd., the Agung I Working Area was won by BP Exploration Indonesia Limited. 

Blogger Agus R Purnomo in Petronas Carigali Ketapang

    The Agung II Working Area was won by BP West Papua I Limited and the Bertak Pijar Quail Working Area was won by PT Mitra Multi Karya.

Auction For Oil and Gas Working Area Phase II 2022

    The investment details for the Firm Commitment and Signature Bonus are US$ 8.1 million and US$ 500 thousand for Petronas Carigali (PC) Ketapang. BP Exploration has a definite commitment of US$ 2.5 million and a Signature Bonus of US$ 100 thousand. Then the BP West Papua Definite Commitment investment is US$ 1.5 million and the Signature Bonus is US$ 100 thousand.

    Meanwhile, Mitra Multi's Fixed Commitment investment is US$ 2 million and the Signature Bonus is US$ 500 thousand. Tutuka said that he was very interested in the Working Area auction this time, giving a positive signal for Indonesia's upstream oil and gas investment at a time of challenging global conditions. 

    In the next stage after the announcement, the Government will send an official notification of the winner and the winner of the auction must submit this letter of intent within 14 working days of receiving the notification of the winner.

    In accordance with the Regulation of the Minister of Energy and Mineral Resources Number 35 of 2021, the signing of the Cooperation Contract is carried out no later than 60 calendar days from the announcement of the winner today.

"For this reason, we hope that the winning bidders can immediately prepare the required documents for signing the KKKS," he said.

Regarding Offer privileges

    Participating Interest 15% PT Pertamina (Persero), Pertamina gets 15% Participating Interest Offering Shares in accordance with the provisions in the Bid Document in accordance with the ESDM Ministerial Regulation Number 35 of 2021, the Government will also submit this to Pertamina.

    In addition to the announcement of the Working Areas, there is currently a Regular Auction for the Oil and Gas Working Area Phase II 2021 which consists of four Working Areas, namely Karaeng, Maratua II, Pope, and West Palmerah. The schedule for access to Bidding Documents is still open until March 24, 2022, while the submission of Participation Documents is from March 24 to 25, 2022.

    Director-General of Oil and Gas at the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that the working area being auctioned, namely the North Ketapang Working Area was won by Petronas Carigali (PC) Ketapang II Ltd, and BP Exploration Indonesia Limited won the Agung I Working Area. The Great II Working Area was won by BP West Papua I Limited and the Pijar Puyuh Bertak Working Area was won by PT Mitra Multi Karya.

Investor Daily, Page-10, Monday, March 21, 2022

FRESH WIND FROM PETRONAS AND BP

 

    The national upstream oil and gas industry gets fresh air from the commitments of Petronas and BP in three of the four work areas offered by the government through the Ministry of Energy and Mineral Resources.

BP

    The inclusion of Petronas and BP in the Working Areas (WK) or oil and gas blocks North Ketapang, Agung I, and Agung II is considered as the success of the government is seeking to improve the investment climate in the country.

    Moshe Rizal, Executive Director of the Association of National Oil and Gas Companies (Aspermigas), said Petronas in the North Ketapang WK, and BP in the Agung I and Agung II WKs is a good thing. The reason is that the two companies are large National Oil Company (NOC) and International Oil Company (IOC).

Blogger Agus Purnomo in Petronas PC Ketapang 

"We hope like that, we will see the realization in the next three years," he said.

    Moshe also hopes that the government will continue to support oil and gas companies in realizing their investment in the country, especially when conducting exploration activities.

"The challenges that will be faced are both technical and non-technical, and the exploration stage is always the riskiest period."

    When announcing the winner of the direct bid bidding for the oil and gas Working Area phase II 2021, Director General of Oil and Gas at the Ministry of Energy and Mineral Resources (ESDM) Tutuka Ariadji said that the terms and conditions offered by the government this time received a good response from the cooperation contract contractors or KKKS.

“We also received input from KKKS that the terms and conditions offered in this auction are very attractive, and their terms are solid. We can see that in Working Area with high risk, the split can be up to 50-50, and if the risk is reduced, the government's share will be bigger," he said.

    He said the government would seek to improve the investment climate in the national upstream oil and gas industry and offer 17 other Working Areas this year.

    To note, the government received a definite investment commitment of US$14.14 million from Petronas, BP, and Mitra Multi Karya in the auction. In addition, there is also a signature bonus of US $ 1.2 million obtained by the State.

Working Area Ketapang Block Petronas 

    In detail, Petronas through PC Ketapang II Ltd. will conduct a G&G study at WK North Ketapang with a budget of US$1 million, 3D seismic covering an area of ​​300 square kilometers worth US$6.39 million, multi-client uplift fee from 3D seismic covering an area of ​​​​262 square kilometers US$750,000, and a signature bonus of US$500,000

    In WK Agung I, BP through BP Exploration Indonesia Limited will conduct a G&G study with a budget of US$500,000, 2D seismic covering an area of ​​2,000 square kilometers worth US$2 million, and a signature bonus of US$100,000. As for WK Agung II, BP through BP West Papua I Limited is ready to conduct a G&G study worth US$500,000, 2D seismic covering an area of ​​2,000 square kilometers with a value of US$1 million, and a signature bonus of US$100,000.

    Then Mitra Multi Karya will do a workover of eight wells with a budget of US$2 million, and a signature bonus of US$500,000.

    Tutuka said that the investment commitments from the three companies were a positive signal for national upstream oil and gas investment in times of challenging global conditions.

Blogger Agus Purnomo in SKK Migas

FULL SUPPORT

    Head of SKK Migas Dwi Soetjipto ensured that his party will provide full support so that the management of the North Ketapang Working Areas (WK) ​​can run smoothly until new reserves are found.

    According to him, the election of Petronas as the manager of North Ketapang shows that Indonesia's upstream oil and gas investment is still attractive to world-class investors.

“Petronas is one of the largest oil and gas companies in the world. With the additional investment in Indonesia, hopefully, this will be able to attract other world-class investors to follow Petronas' footsteps."

    Petronas Executive Vice President and Chief Executive Officer of Upstream Adif Zulkifli said his party was very happy with the results of the auction. Moreover, Working Areas (WK) North Ketapang is located close to where the company discovered oil reserves last year.

"We will continue to strengthen our upstream oil and gas business to provide value and contribute to the development of the energy industry in Indonesia. As a progressive energy and solutions partner, Petronas is committed to providing Indonesia with a safe and reliable energy supply," he said.

    Separately, BP through its official statement stated that Working Areas (WK) Agung I and II are unexplored areas. The two Working Areas (WK) with very significant gas sources are close to the increasing demand for gas.

"The addition of Agung I and Agung II Blocks to our portfolio reflects our ongoing commitment to invest and grow our business in Indonesia," said BP Regional President Asia Pacific Nader Zaki.

Bisnis Indonesia, Page-4, Monday, March 21, 2022