Deputy Minister of Energy and Mineral Resources Arcandra Tahar announced the winner of 2019 Phase I Oil and Gas Working Area Offers with Regular Auction mechanism at EMR Ministry Building in Jakarta, on Tuesday (05/07). Photo by TheInsiderStories.

JAKARTA (TheInsiderStories) – Indonesian Ministry of Energy and Mineral Resources (MEMR) announces Kufpec Ventures (Indonesia) Ltd. and Sonoro Energy Ltd-PT Menara Global Energi consortium as the winner of five 2019 Phase I Oil and Gas Working Area Offers total commitment value and signature bonus of US$ 116.7 million, said the government official on Tuesday (05/07).

According to the Deputy Minister of EMR Arcandra Tahar, the two winners of the tender will operate respectively for the Anambas and the Selat Panjang Working Area.

Kufpec Ventures, will get a definite three-year exploration commitment, which includes G&G study, Seismic 3D 600 km2 (Re-processing and Licensing Purchase) and 1 Well, with a total bonus of $ 2.5 million and a definite commitment of $35.2 million.

While Sonoro Energy Ltd – PT Menara Global Energi’ consortium will get a definite commitment of $74 million and a signature bonus of $5 million for a definite 5-year work commitment. The total investment value of certain commitments from the two Working Areaa is $109.2 million and the total signature bonus is $7.5 million.

The Block Selat Panjang itself is located in mainland Riau province which in February 2018 produced 1 BOPD, while the Anambas Block was located off the Riau Islands coast.

Meanwhile, Tahar said that the other three Working Areas had not been won from four companies. The three oil and gas blocks are the West Kampar Block, West Ganal Block and West Kaimana Block.

“There is a consortium of PT Pertamina – ENI Indonesia Ltd., and Neptune Energy Muara Bakau B.V, but both of them cannot win the tender process for oil and gas exploration areas for the West Ganal Block,” he said at the signing agreement ceremony in Jakarta.

The West Ganal Block is located off the coast of East Kalimantan. The government has promised a minimum signature bonus of $15 million and a minimum of definite commitments.

While the West Kampar Block is located in mainland Riau and North Sumatra which on March 27, 2017 produced 112 BOPD, with a minimum bonus signing of $5 million, and minimum commitments and drilling of six exploration wells worth minimum of $64.43 million.

“For the production Working Area, there are two blocks, namely the Selat Panjang Block and the West Kampar Block. But, none of the West Kampar Block itself was won from two offers made by Starborn Energy Bontang Pte.Ltd. and Nusa Development Sdb.Bhd.,” said Tahar.

Tahar also explained, there was no oil and gas exploration companies in the West Kaimana Block have submitted bids, so the government continues to postpone its banning process in the following period.

The West Kaimana block is located on land and off the coast of West Papua. For blocks in the eastern end of Indonesia, the government budgeted a minimum signature bonus of $2 million and a minimum of definite commitments.

The bidding process, he added, was closed at the end of the Participation Document submission on April 25, where there were seven participation for four Working Areas which were subsequently opened and Final Examinations and Assessments by the Bid Team to provide winners recommendations through the Director General of Oil and Gas Decree the name of the Minister of EMR Number 0116.K/13/DJM.E/2019 dated May 6, 2019.

Previously, the ministry officially opened an auction offer for work areas from five oil and gas blocks on Feb. 21 through the PSC Gross Split contract scheme in accordance with EMR Ministerial Regulation Number 52 of 2017 concerning Amendments to Regulation of the Minister of Energy and Mineral Resources No. 8 of 2017 concerning Gross Split Production Sharing Contracts.

In the past two years, since the implementation of the gross split oil and gas contract, there have been 14 blocks sold, of which five blocks were auctioned in 2017 and 9 blocks in 2018. In 2015-2016, there were no oil and gas blocks that were sold auctioned.

Of the 14 blocks, the total Definite Work Commitments reached $2.13 billion or around Rp32 trillion which can be used for exploration to look for new oil and gas reserves and for the next 10 years. Then, the signature bonus collected from 14 oil and gas blocks was $ 865 million or Rp13.4 trillion.

In addition to the 14 oil and gas blocks that sell well from the auction results, there are 21 oil and gas termination blocks that also use gross splits. Overall, a total of 36 blocks have used gross splits.

Written by Daniel Deha, Email: