SKK Migas Signs $49.1 million Production Sharing Contract for Two Oil and Gas Working Areas

JAKARTADAILY.ID – Indonesian Special Unit for Oil and Gas (SKK Migas) of the Ministry of Energy and Mineral Resources signed Production Sharing Contracts for 2 Working Areas (WK) West Kampar and WK Jabung, which are the results of the Direct Bidding Auction in 2022.

The signing of the SKK Migas contract with the Cooperation Contractor was witnessed by the Director General of Oil and Gas, Tutuka Ariadji. According to him, this signing is proof that the upstream oil and gas sector in Indonesia is still promising for investors.

"Through activities in this WK, it is expected that oil and gas reserves and production can increase sustainably and support the fulfillment of the oil and gas production target," Tutuka said in Jakarta, Wednesday, January 25, 2023.

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The West Kampar WK was offered by the Government through the Direct Offer Auction in 2022 for the period September - October 2022 and the winner was announced on November 23, 2022.

Meanwhile, the Central Jabung WK was offered by the Government through a Direct Offer Auction in 2022 for the period November - December 2022, and the winner was announced on December 28, 2022.

Both oil and gas WKs are contracts that use a cost recovery scheme with a term of 20 years for West Kampar Production WK and 30 years for Central Jabung Exploration WK.

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Prior to the signing of the contract, the KKKS has completed its financial obligations, namely the payment of signature bonuses and submitting implementation guarantees in accordance with applicable regulations.

"The total firm commitment investment from this signing is worth $49,109,982 with a signature bonus of USD400,000," Tutuka added.

The Ministry of Energy and Mineral Resources has appointed the Consortium of PT Aserra Petrolindo Gemilang and PT Sarana Pembangunan Riau Langgak (SPRL) as the winner of the West Kampar oil and gas Working Area (WK) auction located on the coast of North Sumatra and Riau with PT Aserra Petrolindo Gemilang appointed as the operator with a participation right of 80 percent.

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Meanwhile, for the Central Jabung WK, the Ministry of Energy and Mineral Resources appointed the Consortium of PT Cipta Niaga Gemilang and PT Rukun Raharja Tbk as the winner with PT Cipta Niaga Gemilang as the operator with a participation right of 70 percent. (***)