Deputy Energy and Mineral Resources Minister Arcandra Tahar spoke about disruption in energy and mineral sector, Thursday (19/4)

JAKARTA (TheInsiderStories)–PT Pertamina (Persero) and PT Chevron Pacific Indonesia (CPI) are competing over rights to exploit Rokan oil block after its current contract expires in 2021.

Both companies had submitted a separate proposal to take full control of Rokan, which is estimated to have more than 1.2 billion barrels of oil in reserves, Deputy Energy and Mineral Resources Minister Arcandra Tahar said on Thursday (26/07). He said both Pertamina and Chevron seek a 20-year contract for Rokan.

Chevron is currently the operator of Rokan block.

Tahar refused to provide further information related to the content of Chevron and Pertamina’s proposal, including the amount of committed investment, signing bonus, and work plan.

“We considered all aspects [investment, signing bonus, work plan]. The decision is in the Energy and Mineral Resources Ministry’s hand,” he added.

He said the government is evaluating both companies’ proposal and committed giving decision next week. Rokan block will be operated under a gross split scheme, but Tahar denied to comment about the details of the split base.

Meanwhile, Pertamina‘s Finance Director Arief Budiman said the company have sufficient fund to operate Rokan block.

Pertamina’s VP Corporate Communication Adiatma Sardjito said the company is ready to compete with existing operator Chevron who planned to spend around US$88 billion in Rokan block. Pertamina also committed to use advanced technology of enhanced oil recovery (EOR).

“The funds’ issue is a small matter because the production is very big,” he added, as quoted by Katadata.

Chevron submitted a proposal to the Upstream Oil and Gas Regulatory Special Task Force on Friday (20/7). In addition, the company’s officials visited the Coordinating Ministry for Maritime Affairs office on Tuesday (24/07) to present the company’s plan in operating Rokan block.

Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan earlier said the American multinational energy corporation committed investing US$88 billion that will disburse in the two phases. In the first phase from the contract ends in 2021 to 2031, the company will disburse US$33 billion with a production target of 500 million barrel. In addition, the company will disburse the remaining US$55 billion in the next 10 years after 2031 with a production target of 700 million barrel.

Chevron also committed to use the full-scale EOR technology in Rokan block that will boost oil reserve up to 1.2 billion barrel.

Rokan block recorded 207,148 barrel per day (bpd) of oil production from January to June 2018 or 97 per cent of 213,551 bpd target. The Upstream Oil and Gas Regulatory Special Task Force projected Rokan block will reach production of 205.952 bpd or 96.4 percent of target this year.