Pertamina haggles over Mahakam price tag
Pertamina’s upstream ambitions could make it harder for Indonesia to reverse its declining production. (PA)
France’s Total and Japan’s Inpex remain in negotiations with Pertamina to extend their partnership in Indonesia’s giant Mahakam gas block beyond the end of 2017. But the Indonesian NOC will not make a deal without an independent appraisal to recalculate the value of the block’s remaining reserves to help fix the sales price.
At the end of December 2015, when Pertamina was officially appointed operator of Mahakam from 2018, Indonesia’s upstream regulator SKKMigas put the asset value of the block at $4.79 billion. This will shrink by 28%, to $3.45 billion, by the time Pertamina takes the helm, data from the agency shows. Total and Inpex are being offered a maximum 30% stake split between them, which would be worth around $1.04 billion.