Offshore staff

JAKARTA, Indonesia -- Indonesia is considering giving a 45-49% gas split to Premier Oil in exchange for supplying gas to Batam, according to Purnomo Yusgiantoro, Indonesian Mines and Energy minister. Indonesia usually gives 30% gas split after cost recovery under its production sharing contract terms.

Premier has discovered 500 Bcf of gas reserves in the West Natuna block A, which could be piped to Batam, a hub for industries and electricity generating plants.

Hess Corp. and the Malaysian national oil corporation, Petronas, also are partners in block A.

Industry observers said the Jakarta government has been working on several methods to reduce the rising cost of energy for a country which has become a net oil importer as its production has declined to about 1 MMb/d from the peak of 1.6 MMb/d in the 1990s.

8/29/06