TEMPO.CO, Jakarta – The East Kalimantan provincial government has asked for a higher participating interest (PI) for the Mahakam block management. The province wants 19 percent portion, or higher than the maximum stake set out in the Regulation of the Minister of Energy and Mineral Resources No. 15/2015, which is 10 percent.

So far, the central government and the East Kalimantan administration have yet to reach an agreement on the PI portion.

East Kalimantan Governor Awang Faroek Ishak also requested for flexibility in determining the most profitable partner for his province.

Awang met with the Energy Minister Sudirman Said in Balikpapan last Thursday. As a follow up to the meeting results, Sudirman established an oversight committee that will facilitate further discussions between the Government of East Kalimantan and PT Pertamina (Persero).

The technical discussion is targeted to be completed before the end of this year; marked by the signing of a new production sharing contract (PSC).

Last week, the government decided to give a 70-percent stake in the Mahakam block; effective from January 1, 2018. The remaining 30 percent stake goes to Total E&P Indonesie and INPEX Corporation as a token of appreciation to the two companies that have managed the block for almost 50 years since October 1966. Total and INPEX's contracts expire on January 31, 2017.

ALI HIDAYAT | SG WIBISONO (BALIKPAPAN) | ROBBY IRFANI | KHAIRUL ANAM