JAKARTA (Dow Jones)--Indonesian state-owned oil and gas company PT Pertamina is submitting a new bid for an oil block in Iraq and will seek to develop an oil asset in Mauritania, Pertamina president director Karen Agustiawan said Thursday. The company is also bidding on a gas development project in Indonesia with Woodside Energy Ltd. of Australia, she said.
Pertamina also signed a 30-year deal Thursday to buy 840,000 metric tons a year of dimethyl ether from local company PT Arrtu Mega Energie from 2011.
The company had said Wednesday that it was withdrawing a bid for the West Qurna oil block in Iraq as the contract terms offered made the project uneconomic.
"The per-barrel fee was too low. The (income earned) per barrel must be calculated against the risk" of investing in the block, Agustiawan said Thursday.
Iraq's oil ministry had set upper limits of as little as $2 a barrel above minimum production targets for companies seeking to operate Iraqi oil blocks, prices at which most companies balked.
Agustiawan said that Pertamina would submit a fresh bid for an Iraqi oil block in the second round of bidding held by the Iraqi government. She didn't elaborate on whether the second round of bidding had already begun Thursday, nor did she specify whether Pertamina's fresh bid was for West Qurna or for another block.
Agustiawan also didn't specify which Indonesian gas asset the company would bid for with Woodside Energy, a unit of Australia's Woodside Petroleum Ltd. (WOPEY).
Dwi Martono, investment director at upstream unit PT Pertamina Hulu EP, said the state firm would have to be partnered by at least one other oil company in any oil development in Iraq, as Pertamina's daily oil production is less than 200,000 barrels a day, the minimum production specified by the Iraqi government for developers of its oil blocks.
Martono didn't elaborate further.
Pertamina partnered with Malaysia's Petronas and China National Petroleum Corp in its West Qurna bid.
Pertamina and Woodside Energy signed a memorandum of agreement to cooperate on upstream operations in eastern Indonesia and northern Australia in December.
Gunung Sardjono, Pertamina's deputy director for planning, told Dow Jones Newswires earlier Thursday that the two companies are "examining all opportunities in upstream business in eastern Indonesia and overseas, including evaluating new blocks and areas being tendered by BPMigas," Indonesia's upstream regulator.
The two companies have yet to sign a cooperation agreement and can't disclose which assets they might cooperate on or what form such cooperation might take, he said.
Pertamina Thursday said in a statement that it will be the sole buyer of DME from a methanol gasification plant to be built by Arrtu Mega in West Java province, and will utilize the fuel in its program to convert households to liquefied petroleum gas from kerosene, for cooking, lighting and other uses. DME, a methanol derivative, has similar properties to LPG.
source: online.wsj.com
