Indonesia opens 24 new oil and gas blocks for tender and direct offer

Dec 01, 2009 01:00 AM

Indonesia's government is offering 24 new oil and gas blocks in an attempt to raise dwindling production of the fuels, the Ministry of Energy and Mineral Resources said earlier. Twelve blocks will be allocated via regular tenders and the remaining 12 are open to direct offers, the ministry said.
The blocks investors can bid for in regular tenders are the South East Andaman, Tarakan I, Tarakan II, Tarakan III, North Masela, West Berau, Cendrawasih Bay I, Cendrawasih Bay II, Cendrawasih Bay III, Cendrawasih Bay IV, Cendrawasih Bay V and East Aru.

Those available for direct offers are Puri, Sakakemang, Selar, Sunda Strait I, North Madura, Karapan, Mandala, Long Hubung-Long Bagun, Malunda, Sadang, South Mandar and South Sageri, the ministry said.
A recent offering of 24 oil and gas blocks failed to attract enough interest, and the country managed to award only four blocks to investors. Evita Legowo, the ministry's director general, blamed investors' lack of interest on the government's plan to limit the amounts it would reimburse investors for costs after production starts. Many of the blocks were also located in remote areas, that may have also weakened investors' appetite, she said.

The government has said it's willing to offer generous terms to investors to get them to commit to projects in the country.
Indonesia, however, is not the only country seeing investor exhaustion. India's recent licensing round also attracted limited interest, Venezuela has repeatedly postponed an offer of the Carabobo oil license, and Iraq failed to award most of the blocks it offered recently.

Source / Dow Jones
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