Reuters: Indonesia's Pertamina to Operate Mahakam Block from 2018

Indonesia's state-run oil company PT Pertamina will operate the Mahakam natural gas block offshore East Kalimantan starting from Jan. 1, 2018, the country's energy minister told reporters on Friday.

Minister Sudirman Said said Pertamina had met on Friday with Total and Inpex, the current operators of the block, to discuss the transition process.

Analysts have questioned Pertamina's technical and financial capacity to operate Indonesia's single-largest source of natural gas and maintain its production level - around 1.76 billion cubic feet per day (bcfd) last year and expected at around 1.7 bcfd this year. The Mahakam block is the main source of gas for Indonesia's Bontang LNG plant in East Kalimantan.

"There will be further discussion within two weeks to decide how Pertamina would be involved in the transition process, and how the operation would be after 2017, and whether Total would still have a participating interest," the energy minister said, adding that Pertamina would own a majority stake. MORE