TEMPO.CO, Jakarta - Chevron Pacific Indonesia has yet to decide the fate of the enhanced oil recovery (EOR) project in Minas field, Rokan block, Riau. Chevron Senior Vice President for Policy Government and Public Affairs Yanto Sianipar said that the management is evaluating the project after the government guarantees the return on investment. “We are evaluating its impact on our contract,” he said Tuesday in his office.
Further study has been conducted after the energy and mineral resources ministry issued the ministerial regulation no. 26/2017 on requirements for new operators to compensate for investment costs incurred by the previous operators. The regulation is aimed at encouraging old operators to invest even though their contract would soon expire.
Energy Minister Deputy Minister Arcandra Tahar explained that, for example, new contractors are obliged to compensate old contractors who invest US$10 million in oil drilling two years before their contract expired at the same amount. “When [old contractors] start drilling, they would not always see instant results. The increase in production has often been enjoyed by new contractors.”
The regulation holds that the amount of payment is subject to the approval of the Upstream Oil and Gas Regulatory Task Force (SKK Migas).
Chevron earlier said it refused to continue the EOR project in Minas oilfield as it awaits the extension of its operation contract beyond 2021. The company has also proposed contract extension to the government.
Chevron Pacific Indonesia President Director Albert Simanjuntak claimed that EOR project could boost oil output to 17-22 percent per one drilling location. More reason to stop the project, Albert said, is low oil prices. Chevron has twice conducted commissioning that cost US$222 million.