Eric Watkins
Senior Correspondent
LOS ANGELES, Dec. 3 -- Indonesia's upstream oil and gas executive agency BP Migas may reduce the mandatory oil and gas exploration period to 3 years from 10 years to accelerate exploration at newly awarded oil and gas blocks.
BP Migas Chairman Kardaya Warnika said if oil and gas companies failed to find reserves during the 3-year period, they would have to return the concession areas to the government.
Should the companies succeed in finding reserves during the period, they would be not be given deadlines for conducting drilling activities, he said.
Under the current regulation, oil and gas contractors are given 10 years to carry out exploration and drilling activities, or the government will revoke their rights.
"We plan to exclude drilling activities from the list of commitments stated in the exploration stage. We are aware that drilling can be done only if the feasibility study proves that reserves are available. If there are not any, we don't have to do the drilling," Kardaya said.
He expressed hope that under the new arrangement the government would see a 30% increase in oil and gas production by 2009, rising by 100,000 b/d to 1.03 million b/d as targeted in the 2008 national budget.
Contact Eric Watkins at [email protected].
