SKK Migas: ConocoPhillips to farm out in Palangkaraya Block

Muchamad Nafi
12 November 2015, 13:25
Stand pameran ConocoPhillips
Arief Kamaludin|KATADATA

KATADATA - ConocoPhillips, a US-based oil and gas giant, is planning to farm out its shares in Palangkaraya Block. Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas, the government’s agency to regulate or control business contracts and affairs in upstream oil and gas sector) Deputy Chief M.I. Zikrullah has confirmed it. 

However, Zikrullah does not know in details regarding the plan, including the percentage of stakes to let go from the oil and gas firm; since ConocoPhillips has not give the plan to SKK Migas. “There is a plan, but they haven’t give it to us,” Zikrullah said to Katadata in Dharmawangsa Hotel, Jakarta, several days ago.

This block is located in Palangkaraya City, Kapuas Regency, in Central Kalimantan. ConocoPhillips fully owns the block, which is being operated by its subsidiary, Petcon Borneo Limited. 

For additional information, right now ConocoPhillips has two oil and gas blocks in Kalimantan. First, it is Kuala Kurun Block, which will conduct a seismic test in the first quarter next year. This block is being operated together with Petronas. The other one is Palangakraya Block, which has conducted a drilling process on one exploration well. 

ConocoPhillips’ attempt to farm out its share ownership has been done before in Warim Block, Papua. At that moment, ConocoPhillips reasoned to SKK Migas that the firm needed to focus more to operate Palangkaraya Block. (Read more: ConocoPhillips will sell Warim Block). 

Other than Warim Block, the firm has also opened up the data room of B PSC Block at South China Sea so that investors or other oil and gas companies can access the data and invest in it. 

ConocoPhillips has indeed known to be quite active recently in selling the assets that the firm considers as not economically profitable in a long-term basis. This practice has been done since 2012, and has successfully acquired a fresh US$ 12 billion. 

However, an official of ConocoPhillips said that there is no plan to farm out the stakes in Palangkaraya Block. There is indeed a problem in terms of the business license / permit issuance from the regional government, but it has been sorted out last month, the official said.

Reporter: Arnold Sirait
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