Govt urged to give West Madura block to local company

Jakarta - Several speakers at a public discussion here Wednesday called on the government to replace Kodeco of South Korea as the present operator of the West Madura Block with a local company.

The call was made by former Regional Representives Council member Marwan Batubara, House Commission VI member Chandra Tirta Wijaya and oil observer Kurtubi during a discussion at the House of Representatives Building.

They said local companies, including state-owned oil amd gas company Pertamina, already had the capability to manage and operate the field.

Kodeco which has been the operator of the field for the past 30 years was expected to conclude its contract on May 7, 2011.

Therefore, Marwan Batubara who had established an Indonesia Resources Studies (Iress) center urged the government not to hand the management of the oil/gas field to a foreign company again.

The government must give it to Pertamina, he said. Based on Law Number 22/2001 on oil and gas and lesser regulations Pertamina as a state-owned company is allowed to apply for operating a block already expired but still economical.

He said Pertamina had already applied to the government to manage 100 percent of the block after the expiration of the Kodeco contract but the government had not yet given a response to it.

Marwan said Kodeco and CNOOC of China had

Marwan mengatakan, Kodeco dan CNOOC asal China would conduct a farm out before the termination of the JOA ( already agreed by energy regulator BPMigas).

He said he suspected the two companies had taken a lot of profit if the signature bonus was set by the government at only US$5 million.

"If Pertamina is forced to pay it the two companies would in reality only pay US$2 millions," he said.

"This action that has inflicted a loss on the state must be investigated and audited. Officials involved in the farm in/out must be questioned," he said.

Kurtubi meanwhile said the habit of handing over oil and gas fields to foreigners was colonial mentality. It is like what the Dutch colonialist did when they occupied Indonesia. They handed over the management of the country`s oil and gas to private companies while they just collected royalty and tax.

He said such mentality must be eradicated and "therefore the West Madura Block must be self-managed. We will just produce, pump without any risk so that it will flow to Pertamina."

Kurtubi said Indonesian officials who have the habit of handing over the management of oil and gas to foreign companies must be suspected.

He feared there was illegal money involved and therefore the Corruption Eradication Commission must investigate possible bribery to the officials by foreign companies.

source : antaranews.com