Minister of EMR Promote Directly Auction of Oil and Gas Working Area 2017

MINISTRY OF ENERGY AND MINERAL RESOURCES

REPUBLIC OF INDONESIA

PRESS CONFERENCE

NUMBER: 00095.Pers / 04 / SJI / 2017

Date: July 07, 2017

Minister of EMR Promote Directly Auction of Oil and Gas Working Area 2017

Minister of Energy and Mineral Resources (EMR) Ignasius Jonan, Friday (7/7), at the Office of the EMR Ministry held a direct meeting with the Chief Executive Officers (CEOs) Contractor Cooperation Contracts (KKKS) oil and gas to promote 15 Working Areas (WK) Oil and Gas which is auctioned in 2017. The event was held entitled Breakfast Meeting with Minister of Energy and Mineral Resources with a discussion on Indonesia Petroleum Bidding Round 2017. This event is the first time directly attended by Minister of EMR. On the occasion, the Minister of EMR delivered a presentation to promote oil and gas WK and convince the CEO of KKKS that the upstream oil and gas business in the country is still attractive.

A total of 52 large oil and gas KKKS are invited to get a direct explanation from the Minister of Energy and Mineral Resources on 10 conventional WK and 5 non-conventional WK offered. All WK offered under Production Sharing Contract (PSC), gross split scheme in accordance with the Regulation of Minister of Energy and Mineral Resources Number 8 Year 2017 on Production Sharing Contract Gross Split.

Minister Jonan explained that the oil and gas industry has its own competition and challenges. The challenge is not only to compete in the oil and gas industry, "we have to work together to build this industry, either from the government or the company so that the industry is still going forward," said Minister Jonan.

In the discussion session which took place in an atmosphere of openness, the question arises, among others related to the appeal of the gross split scheme that will be applied to the offered WK oil and gas. Answering the question, Minister Jonan confirmed that the auction process of WK oil and gas this time is designed to remain attractive amid sluggish oil prices. "We should all be able to face the current oil price of only about 50 dollars (US) per barrel", explains Minister Jonan.

In a press conference held after the Breakfast Meeting, Vice Minister of EMR, Arcandra Tahar revealed that in order to clarify the tax aspects of the gross split scheme, the ESDM Ministry and the relevant ministries are preparing a new Government Regulation (PP). "PP like PP 79/2010 and this is being awaited KKKS who are interested in the blocks offered, of course this is crucial. I hope the end of July 2017 can be issued PP taxation rules gross split," close Wamen Arcandra.

Below is a list of 15 Oil and Gas Working Areas 2017 offered through Direct Bidding and Regular Bidding mechanisms: https://www.esdm.go.id/id/media-center/pengumuman/pengumuman-penjual-wilayah-kerja-minyak-and- Gas-earth-year-2017

Head of Communication, Service Bureau

Public Information, and Cooperation

Sujatmiko

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