Conventional Oil and Gas WK is Again Auctioned, Including West Ganal and West Kaimana

Source Press Release
Company
Tags Licensing Rounds, Upstream Activities
Date May 07, 2019

The Government has auctioned 5 Oil and Gas Working Areas (WK) Phase I of Year 2019 with the Regular Auction mechanism carried out from February 25, 2019 to April 25, 2019. Of the five oil and gas WKs auctioned, the Deputy Minister of Energy and Resources stated Mineral Power (ESDM) Arcandra Tahar, four Oil and Gas WKs are in demand by various companies, this shows that the investment in Indonesia's upstream oil and gas sector is still in demand, especially with the implementation of the scheme for gross split.

"Of the five blocks that we offer (Anambas WK, West Ganal WK, West Kaimana WK, Long Strait WK and West Kampar WK), four are in demand by several companies, however there is one block, West Kampar which requires more time to evaluate because this is a short time of two months, because we need more time to re-tender, "Arcandra said after announcing the Winner of the 2019 Phase I WK Migas Offer, Tuesday (7/5).

The government continued Arcandra, will immediately auction off two WK Migas, namely West Ganal and West Kaimana and like other auction winners, the Government hopes to get higher offers than those offered by the Government."

In addition to auctioning two blocks, West Ganal and WK West Kaimana WK, the Government will also auction several other WK Migas blocks. Hopefully in the second phase of the auction the two winners can be determined, so please be patient, tomorrow we will auction," continued Arcandra.

Indonesia's oil and gas investment climate, especially in the upstream sector, shows an attractive trend for investors, especially since the introduction of gross split profit sharing schemes. The change in the contract system to gross split is Indonesia's need to compete with other countries in attracting investors. With a gross split system where the administrative process is simpler, the investment costs are efficient and regulations that provide certainty are able to increase investor confidence and confidence in the climate of oil and gas investment in Indonesia.

Recorded during 2017-2018, 14 oil and gas working areas were successfully auctioned with a gross split system. Then a number of oil and gas termination blocks that have been carried out with contract extensions also apply gross splits.

The high investor confidence in the investment climate in Indonesia can also be seen from their commitment to pay for definite work commitments (KKP) and bonus signatures that are part of the gross split system. Of all oil and gas block contracts that use gross split, KKP funds have been collected worth Rp. 31.5 trillion and a signature bonus of Rp. 13.4 trillion (SF)

Source: EvaluateEnergy® ©2019 EvaluateEnergy Ltd