Regarding Medco Asking To Increase Gas Prices In Corridor Blocks, Conglomerate Hilmi Panigoro Says This

JAKARTA - Medco Group President Director Hilmi Panigoro gave an answer about the news of PT Medco Energi Internasional Tbk asking the government to increase the price of natural gas upstream. Previously, it was reported that there was a proposal from PT Medco Energi Internasional Tbk to increase the selling price of gas upstream.

Hilmi said that the price of gas and allocation is in the hands and the government cannot intervene.

"In Indonesia, the allocation and gas price are completely determined by the government. So we will as a producer try to produce as much gas as possible and as efficiently as possible," Hilmi told the media quoted on Tuesday, October 17.

It was said earlier that the reason Medco asked to increase gas prices upstream was because the field being managed was which in terms of production had decreased so that operators needed other efforts to increase their productivity. With adjustments to gas prices upstream, Medco can maintain gas production in the Grissik Field, Corridor Block.

Responding to this, Himi admitted that the field was indeed sudden, but he ensured that production could still be done because Medco had the ability to maintain the production of the mature field.

"If it's mature, it's definitely, it's old. But we as one of the companies such as Medco are production defense capabilities in the field that have matured and we have proven it many times," explained Hilmi.

Meanwhile, regarding costs, Hilmi ensures Medco is still one of the most reliable companies in maintaining cost leadership.

"About today's costs, Alhamdulillah, one of Medco's advantages is to maintain cost leadership and this is overall, we can keep it. Our costs are still below 10 dollars per barrel of equivalent oil," concluded Hilmi.

Met separately, the Director General of Oil and Gas of the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that his party would negotiate with stakeholders upstream, namely gas producers and buyers so that gas prices would not increase.

Tutuka continued, the Ministry of Energy and Mineral Resources will also evaluate the costs incurred by Medco in managing the Corridor Block so that additional incentives can be given to operators.

"We evaluate the Grissik Medco field. The first thing we consider is that the cost must be reasonable, benchmarks exist. IRR is the result of the cost, so we have to fix the cost first," concluded Tutuka.