TEMPO.CO, Jakarta - ConocoPhillips has set a target to finalize the transfer of South Natuna Sea Block B ownership to PT Medco Energy Internatinal Tbk by the end of this year.

"We have set a target to finalize the financial closing by the end of this year," ConocoPhillips vice president of development and relations Joang Laksanto said at the Energy and Mineral Resources Ministry office on Friday, September 23, 2016.

Both companies announced the acquisition on September 19, 2016. In addition to acquiring 40 percent of ownership in South Natuna, Medco has also purchased ConocoPhillips Singapore Operations Pte Ltd that manages Onshote Receiving Facility in Singapore.

Medco has also acquired the management rights of the West Natuna Transportation System (WNTS) along Riau Islands’ waters. However, both companies have not revealed the value of the transaction.

Joang remains silent over the transaction report submitted to Energy Ministry. It was reported that the transaction required government approval, since the company is bound to a profit sharing agreement. However, Joang claimed that he had coordinated with the Upstream Oil and Gas Regulatory Special Task Force (SKK Migas).

Medco CEO Roberto Lorato revealed that the acquisition would result in an increase in the company's annual oil and gas productivity by 35 percent.

"The transaction will directly increase the revenue. We hope that we can integrate these important assets with Medco’s upstream portfolio," Roberto added.

SKK Migas deputy chairman Dzikrullah said that the transition would be commenced after the two companies finalize the acquisition process. He also ensured that hundreds of ConocoPhillips employees would remain employed in South Natuna after the acquisition.

"The manpower issue has been addressed. Both companies have agreed to maintain the employees," Dzikrullah said.

The South Natuna Sea Block B's oil and gas productivities currently stand at 19,300 barrels of oil per day and 34,000 barrels oil equivalent per day (boepd). The figures were predicted to drop to 17,400 barrels per day and 30,900 boepd in 2017.

ConocoPhillips is also selling its LPG processing facilities in Belanak. Despite sales of its assets, the US-based oil company remains committed to investing its money in Indonesia.

"We are still committed to investing [in Indonesia]," Joang clarified.

ROBBY IRFANY