TEMPO.CO, Jakarta – State oil and gas company Pertamina announced it will submit the proposal to manage the fields in Mahakam block to the Ministry of Energy and Mineral Resources, taking it over from the current manager—whose contract will expire in two years.

Syamsu Alam, director of Pertamina's upstream unit PT Pertamina Hulu (Persero), said the proposal will be submitted around February or March next year.

"The proposal is related to Pertamina's readiness to manage Mahakam block," he said at the Ministry of State-Owned Enterprises office yesterday.

According to Syamsu, Pertamina has formed a team to communicate with Total E&P Indonesie—the French oil and gas company that holds the management rights in Mahakam block from 1967 to 2017.

"The sooner the government makes a decision the better. That way we can come up with good anticipative measures as well," Syamsu said.

Total E&P spokesman Kris Hartadi declined to comment about the possibility of Mahakam's management being handed over to Pertamina after Total's contract is due. "We have no comment for now. It is better for us not to negotiate with the media," he told Tempo via text message some time ago.

Total E&P Indonesie has been managing the Mahakam block for 48 years together with Japanese company Inpex Corporation with a 50-50 participating share. The contract will expire in 2017, or when it reaches its 50th year.

In a bid to nationalize the oil refinery industry, the government has asked Pertamina to takeover the block's management after the contract is due, afterwhich the state company will be the majority shareholder.

KHAIRUL ANAM | ALI HIDAYAT