Pertamina signs contracts for Libyan blocks

Eric Watkins
Senior Correspondent

LOS ANGELES, Dec 13 -- Indonesia's state oil and gas firm PT Pertamina has signed contracts with Libya to explore and develop two blocks, one onshore and the other offshore.

Pertamina is expected to spend $3.6 billion to develop the Sirte Block in the Sahara Desert and the Sabrata Block in the Mediterranean Sea over a 30-year contract period under an agreement with Germany's Commerzbank AG.

Pertamina said it would initially spend $49.1 million to conduct seismic tests and drill two wildcat wells on the Sirte Block and another two wells on the Sabrata Block over a 5-year exploration period.

The company will start exploration in both blocks in 2006.

Pertamina would get 11.7% of the revenue from Sabrata during production period and 8.8% from Sirte, according to a company spokesman. He also said the Libyan government would bear 50% of the development cost and would repay 87.6% of the production cost.

The two blocks cover a total of 3,671 sq km.

Contact Eric Watkins at hippalus@yahoo.com.

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