Indonesia's Pertamina expects to sign an agreement with Iran to evaluate investing in two oil and gas blocks sometime after the Muslim holy month of Ramadan that ends in July, a company official said on Monday.
A deal would be Indonesia's first investment in Iran's upstream oil sector. Last month Pertamina inked an agreement to purchase 600,000 tons of liquefied petroleum gas (LPG) from state-run marketer National Iranian Oil Company (NIOC), reported Reuters.
Pertamina plans to sign a memorandum of understanding with state-owned NIOC to evaluate the two blocks and eventually import crude from the sites for processing in Indonesia if the bid is successful, Pertamina upstream director Syamsu Alam told Reuters.
"We want to manage those blocks. We want to be operator in those blocks," Alam said in a phone call, without identifying the areas.
"Once the blocks are in full production, output could reach hundreds of thousand of barrels per day, but now they haven't met that number yet. They're not mature yet."
Alam was commenting on statement earlier on Monday from an official at Indonesia's Energy Ministry that the Pertamina deal was the next step after an agreement between the governments of the two countries.
"The government to government agreement is done, so now (we're) following up with a company to company (deal)," Oil and Gas Director General Wiratmaja Puja said.
The announcement comes as Iran is about to launch new investment contracts for companies seeking to bankroll upstream projects in its oil and gas sector.
Launching new contracts
Iran's Oil Minister Bijan Namdar Zanganeh said on Monday that the first phase of the country's oil and gas contracts will be launched this summer and will tender 10 to 15 fields.
Some 135 companies including BP, Total, Italy's Eni and Spain's Repsol attended a conference in Tehran in November to hear about the Iran Petroleum Contract (IPC).
The IPC would end a buyback system that dates back more than 20 years that bans foreign companies from booking reserves or taking equity stakes in Iranian companies.
Former head of the NIOC Rokneddin Javadi said in May that companies would be invited to bid in July.