By Andreas Ismar
JAKARTA, Indonesia--Indonesia's PT Indika Energy (INDY.JK) said
Thursday that it has signed an agreement to acquire a 10% interest
in an oil block in Indonesia's Papua province that is operated by
Total S.A. (TOT).
The Indonesian government in 2011 awarded Total 100%
participating interest and operatorship in the Southwest Bird's
Head block, located in the offshore Salawati Basin, roughly 2,800
kilometers northeast of Jakarta.
"This purchase will strengthen further our energy platform; it
will leverage Indika Energy's indepth understanding of the l market
context and create synergies with our activities in Papua," Indika
President Arsjad Rasjid said in a statement.
Both companies, which didn't disclose the transaction value,
said that the deal is subject to approval by Indonesian
authorities.
They also said that drilling in the first exploration well in
the concession, which covers 7,176 square kilometers, will start
before the end of April.
Elisabeth Proust, the head of Total's Indonesia operation, said
in a separate statement that the deal "is a first step for
developing a wider cooperation between Total and Indika Energy and
demonstrates Total's ability to team-up with quality local partners
to explore and develop Indonesian oil & gas resources."
Total, among the biggest gas producers in Indonesia, earlier
this week criticized Bank Indonesia's policy on companies sending
their earnings back to their home countries, saying its status as
production-sharing contract holder means it takes on significantly
greater financial risks than non-PSC holders and the Indonesian
central bank should give it an exemption.
Write to Andreas Ismar at andreasismar.sandiwan@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires