VIVAnews - Thirteen oil and gas production sharing contract (PSC) contractors are likely to have their contracts terminated.
Head of Upstream Oil and Gas Regulator (BP Migas) R Priyono said the contracts may be terminated because the contractors are yet to work on the working area.
"[The contract termination] is being processed by the government," he said on Wednesday, March 4.
According to him, the thirteen PSC contractors are part of 142 other PSC contractors that are still exploring the working area.
Based on Article 15 of Law/2001 on Oil and Gas, the exploration period may reach six years and may only be renewed once for every four years. Therefore, by 10 years, the PSC contractors should have produced oil and gas.
Priyono went on to say that 80 percent of national oil and gas production have been explored from mature wells. "Mid-to-low class PSC contractors have commonly explored the mature fields so that there there will be less chance for new [oil] finding," he said.
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Translated by: Bonardo Maulana Wahono
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