Pertamina to Replace Shell in the Masela Block? Here’s the update..

Photo: Masela Block (Doc.Reuters)


Nusa Dua, CNBC Indonesia – PT Pertamina (Persero)’s plan to enter into the management of the Masela Block Abadi Gas Field is getting brighter. The latest news is that this state-owned oil and gas company has signed a Non-Disclosure Agreement or NDA.

Main Director of Pertamina Hulu Energi (PHE), Wiko Migantoro said the company had signed an NDA with Shell as the owner of the Masela Block’s 35% participating interest. However, he could not disclose in detail the agreement between the two parties, because the NDA itself is a confidential and binding agreement.

“We have talked with Inpex and Shell, but for the details I have signed the NDA. So we can’t talk about the contents first until the deal is done. Indeed, what we want to divest is 35%. We will talk about that figure,” he said when met in Bali, Tuesday (18/10/2022).

Previously, Pertamina’s ability to replace Shell in the Masela Block Abadi Field project was in doubt. The reason is, if Pertamina is pushed into this giant gas project, Pertamina will have to disburse funds worth US$ 6 billion or Rp. 89.16 trillion (exchange rate of Rp. 14,864/US$).

The funds are to acquire Shell’s 35% participating interest (PI) in the jumbo block currently operated by Japanese company Inpex. The amount of the fee was disclosed by the Chairman of Commission VII DPR RI Sugeng Suparwoto.

According to Sugeng, with the entry of the Rokan Block into Pertamina’s hands, this state-owned oil and gas company has actually had enough to bear an extraordinary burden. Especially if it has to be added to managing the Masela Block.

Sugeng said that Pertamina’s entry into the Masela Block could happen, but Pertamina must at least disburse around US$ 6 billion to acquire PI’s 35% stake in Shell. This figure appears if later the investment for the development of the Masela Block as a whole costs US$ 19 billion.

“You can calculate how much 35% of US$ 19 billion. More or less US$ 6 billion is needed. Whereas today for Rokan alone, Pertamina is still quite gasping with working capital, he still has to do drilling and so on,” he said when met at JCC Senayan , Thursday (28/7/2022).

He is actually happy if the Masela Block can later be managed by a national party. However, he also reminded that this country must be realistic. “We still need Foreign Direct Investment (FDI). So we also offer investors in the oil and gas sector to replace Shell. Because it’s important, they bring those here,” he said. (pgr/pgr)


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