50 WK Migas Terminate Contract, Ministry Of Energy And Mineral Resources: Will Be Auctioned Again

Illustration (Photo: Doc. Antara)

JAKARTA - Director General of Oil and Gas (Dirjen Migas) of the Ministry of Energy and Mineral Resources (ESDM) Tutuka Ariadji revealed the fate of 50 oil and gas working areas (WK) whose contracts have been terminated.

Tutuka said the Ministry of Energy and Mineral Resources had conducted a damp evaluation of the 50 WK.

"So from what was there, we evaluated around 50 WK, we added data, then we will re-auction," said Tutuka, quoted on Wednesday, October 18.

Tutuka added, if not all of these WKs will be auctioned. The Ministry of Energy and Mineral Resources will still see a WK that has great potential to be developed through auctions.

In addition to the auction, his Ministry also opens development options through joint studies.

"And we are honest, we will give what we can still carry out, we will re-auction or joint study will be carried out," he added.

He explained that the reopening tender mechanism was immediately announced while the joint study was open to interested KKKS and the first right refusal mechanism would be applied.

"So those who join the study will be a priority," said Tutuka.

The reasons for the termination of the contract were partly due to two things, namely first, there are several oil and gas working areas that have reached the exploration deadline so that the contract is automatically terminated.

Second, is because it is voluntary. In the oil and gas industry, he said, there is always uncertainty even though operators have conducted studies on geological, reservoir and geophysical studies.

"The problem is that there is uncertainty that causes the potential resources that will be used as reserves to be said to be very small or even non-existent, or maybe not economically so that the contractor does not continue," said Tutuka.