JAKARTA (RAMBUENERGY.Com) – PT Pertamina through its affiliated PT Pertamina Hulu Energi (PHE) East Ambalat has been formally awarded to develop the East Ambalat oil and gas block, located in the Sulawesi Sea, to the east of Kalimantan Island.
The block was handed over to Pertamina unit after Chevron Indonesia’s right to explore the block expired. Pertamina however is yet to disclose the details of the production sharing contract (PSC), with regard to revenue split.
Indonesia awarded the exploration rights in the East Ambalat block to the US oil giant, Chevron Corp and the contract was originally expired in 2010.
PHE East Ambalat, which holds 100 percent working interest, becomes the operator of the block.
The block is located on the border between Indonesia and Malaysia and geologically it is located in the Tarakan Basin.
The production sharing contract (PSC) of the East Ambalat block will last for 30 years. Pertamina is committed to invest US$8.5 million in the first three years. The block has water depth of 2,000 meters coverng an area of 4,735 square km. East Ambalat block is about 100 km to Bunyu production facilities.
Pertamina has said although the government has transferred management of the East Ambalat Block from Chevron Indonesia to Pertamina, the company has admitted that it will be seeking a partner to share the risk.
Pertamina’s Senior Vice President of Upstream Business Development Denie S. Tampubolon said earlier that the block contains huge oil and gas potential reserves. However, exploration is needed to determine the exact reserves because no wells have been drilled so far.
Although Malaysia has claimed sovereignty over this territory since 1979, Indonesia has been carrying out activities in the area since 1967 through production sharing contracts with Total E&P Indonesia, BP, Hadson Bunyu, and Eni Bukat. (*)