19 June 2015, News Wires – Total will gain a stake in the Mahakam block off Indonesia that it will share with Inpex once its operating rights expire at the end of 2017, when state-owned Pertamina will take over operatorship, according to a report.
The Indonesian government said on Friday that Pertamina will gain a controlling 70% stake in the giant field, leaving France’s Total and Japan’s Inpex to hold jointly the remaining 30% share, Reuters reported.
The division of the stake between the pair, which have run the project on a 50:50 basis for more than 40 years, was still subject to discussion.
Pertamina will operate the Mahakam block from January 2018 and will share the 70% participating interest with a regional government-owned enterprise, according to the news wire.
Indonesian Energy Minister Sudirman said there would be no more negotiations about the ownership ruling, “so Total and Inpex will report this decision to their head offices”, he was quoted as saying.
Total and Inpex have invested more than $30 billion in the project, but output has been declining as the field ages, although it is forecast to continue producing oil and gas until 2032.
The duo did not immediately respond to written requests when contacted by Upstream.
Pertamina said earlier in the year it would invest about $2 billion annually in Mahakam to achieve production in the range of 1.2 billion to 1.5 billion cubic feet per day of gas.
Meanwhile, the French company is set to reduce by between 10% and 15% its earlier budgeted investment of $2.4 billion in Indonesia in light of the fall in oil prices.