Showing posts with label oil. Show all posts
Showing posts with label oil. Show all posts
, ,

Sneak Peek of EPSCA 10

Tuesday, July 6, 2010


The E&P Sharing Contracts and Agreement 2010 is taking place in the 6th until the 8th of July in the Grand Hyatt, Jakarta. Master Class A is taking place on the 6th of July with the topic “Structuring, Negotiating and Managing EPC Contracts in the Oil and Gas Industry”.

Tomorrow is a special day as the plenary session will take place. There’s an exciting segment where Dr Widjajono Partowidagdo of the National Energy Council (DEN) will discuss a new economic model he’s developed on the “Next Steps of Action” for operators and government to achieve the vision of the forum: Reformed, Energetic and Efficient E&P Industry in Asia Pacific through fresher, commercially viable E&P agreements.

High-level executives from oil and gas, oil financing and government sectors, supermajor IOCs, big NOCs, INOCs, SOCs including ConocoPhillips, ExxonMobil, Total, Hess, Samsung, Petronas, PTT, Pertamina, Medco, major law firms, and teams from Indonesian regulators in the ESDM and BPMIGAS attended the forum.

Click here (Masterclass A) and here (Masterclass B and C) to get a sneak peek on the Master Classes. Read the forum agenda here.

, , , ,

What does “BP” stand for?

Tuesday, June 8, 2010

Allrite mate, time for sum intermezzo. Here's a homework for you CSR and social media experts. That fake BPGlobalPR twitter account just crowdsource a disparaging quizz a few minutes ago. What does BP stand for? he asked. Well, here's a snippet of the answers:

, ,

New Dates for Dialogue with Business Leaders and Regulators at EPSCA Forum, 6-8 July 2010

Tuesday, April 13, 2010

82410 - Official Brochure v7.pdf (593 KB)
View this on posterous

Due to new developments, EPSCA Forum is moved to a new date 6-8 July 2010. Following is the excerpt of the email I received:

Last week, a major development has occurred where major support from Dr Evita Legowo, Director-General – Oil & Gas, Ministry of Energy, had been cemented which will bring us closer to the forum’s raison d'ĂȘtre, Reformed, Energetic and Efficient E&P Industry in Asia Pacific through fresher, commercially viable E&P agreements, and increased certainty on regulations, risks and returns from E&P investments in Asia, especially Indonesia.

Hence, I was informed this evening that the EPSCA Forum will be moved to its new date on 6-8 July 2010 in view of this major positive development, which would be a great opportunity for all delegates to have an exceedingly impactful meeting with colleagues and regulators. 

Due to the definitive importance of new regulatory developments in Indonesia pertaining to upstream contracts and the push for more commercially viable arrangements for technically complex plays, major upstream players and other investors have confirmed to join us at this important meeting. We may also get the players who are recently involved or interested in making money out of these technically complex upstream opportunities. We suggest you may want to conduct some interviews on site if you will be sending a representative, as the combination of delegates, speakers, partners and sponsors is very unique and rarely found at one place.


Please find the revised brochure attached.


EPSCA 10 list of speakers (update 2)

Tuesday, April 6, 2010

To give you an update, this is the list of speakers for the upcoming EPSCA 10:

  1. Dr. Evita Legowo, Director General Oil and Gas, ESDM (tent.)
  2. Trijana Kartoatmodjo, Deputy Operations, BPMIGAS
  3. Benny Lubiantara, Fiscal Policy Analyst, OPEC (as Advisor)
  4. Tariq Shafiq, Founding Executive, Iraq National Oil Company (also author of new Iraq oil law, Forum Chairman)
  5. Ittiporn Boonpracong, Deputy Director-General, Department of Treaties and Legal Affairs (Malaysia-Thailand Joint Authority)
  6. Faiz Shahab, Commissioner, PT Prime Petroservices
  7. Joseph Amudi Tobing, Senior Legal Counsel, Hess Limited
  8. Peter Godfrey, Vice President (Commercial), Arrow Energy International (on CBM development with PT Medco)
Click here to download the brochure. In order to claim 10% discount from indolawreport, fill in this promotional code  “82410PM-ILR-4Q" in the booking form.

, ,

The Pertamina Bribery Case: R v Innospec Limited

Saturday, April 3, 2010

As you might be aware, the Indonesian Commission for the Eradication of Corruption (KPK) recently investigated the alleged bribery of former Indonesian's Pertamina (State owned oil company) top officials for delaying the enforcement of TEL-free gasoline policy and securing the TEL supply contract to Pertamina. 

The bribery was allegedly conducted by Innospec subsidiary in Indonesia through a series of ad-hoc funds and financial engineering. Some of the important points in the UK's Serious Fraud Office document:
65. It is not known how many ad hoc funds there were, nor responses for one off payments, though there is reference to a number within documentation provided to the SFO by Innospec. These additional payments were variously referred to as the “Lead Defense”4 fund; “Lim WS account”5; “compensation fund”6; “extraordinary costs”7; “cumulative costs”8; “special funds”9; “promotion fund”10 or “exceptional promotional work”11; “special bonus”12; “cranes” 13 and the “Rachmat Sudibyo fund”.
 66. This fund was conceived and largely operated during a period predating the Indictment. In the first instance between 2000 until his departure in August 2002, a recipient of ad hoc bribes was Rachmat Sudibyo (“Sudibyo”). The “Rachmat Sudibyo Fund” was a corrupt vehicle to pay Sudibyo, the Indonesian Director General of Oil and Gas at the Ministry of Energy and Mineral Resources. He was in post until August 2002, whereupon he was appointed Chairman of BPMigas – the newly established oil and gas authority.
69. The Special Committee retained KPMG to examine all payments made to PTSI. KPMG found two large payments, one in 2001 ($265,000) and one on 8 January 2002 ($295,150) with invoices stating that they were: “For payment all Pertamina/Migas & Lemigas Personnel (sic) travel, hotel, daily expenses overseas during the year 2001 spent in promotion of OCTEL’s products, as earlier agreed.”.

76. Innospec’s agents therefore made corrupt payments to public officials at Pertamina which were not dependent upon or related to specific orders for TEL being made. Corrupt payments were made as general sweeteners “to clear the air”, through various mechanisms including the agents’ general commission, to “buy of [sic] some Pertamina people”, to maintain or increase market share.

77. Furthermore, Innospec’s agents also requested further funds in order to make corrupt payments to a rival agent – Wisnu – who had apparently been tasked with marketing Chinese-sourced TEL to Pertamina.

83. In 2003 and 2004, Innospec’s agent, Sebastian, targeted Suroso, who became the Refinery Director of Pertamina. It is believed that this position was second only to the President or CEO of Pertamina. In effect Suroso had authority, at least until 2005, to sign and agree purchase orders on behalf of Pertamina. Even after the creation of MIGAS, individual refineries and Pertamina more generally had certain autonomy to enter into contracts with particular suppliers.

Read the full document at the SFO's web here.

The UK's Innospec had pleaded guilty to the offence. The UK's DoJ is currently carrying criminal investigation into the matter.

, ,

E&P Sharing Contracts and Agreements 2010 (Update 1)

Tuesday, March 16, 2010

I have been informed that Tariq Shafiq, who is involved in writing the new Iraqi Oil Law will be joining the event. Here's the tentative schedule for the speakers for Day Two:

Plenary One | 09.00 - 10.45
The post-recession E&P industry agreements and the
challenge of recovery
Chairman’s Opening Remarks
Mr Tariq Shafiq, Founding Executive, Iraq National Oil
Next-generation E&P engagement: Outlook for the world and
Asia in 2010
• To what extent will the downturn bring fundamental change
to the nature of E&P contracts in Asia and how will IOCs,
NOCs and service contractors respond?
• What are the bright spots and challenges for the service
Ministry of Energy and Mineral Resources, Indonesia*
Transforming PSAs: Evolving contracting models and the push
to abolish the PSA
• Revisiting and transforming the original PSAs to more win-win
commercially viable arrangements
• What are the alternatives available to successfully transform a
PSC into a more economically viable contract?
Hardiono, Deputy Chairman, BPMigas*
Structuring advanced models of cooperation in the form of a
Joint Venture or Partnership
• What specifi c terms have to be adopted for safeguarding your
agreements and ensuring successful collaboration?
• How changing roles of IOCs and NOCs contribute to the
shape of the partnership agreement and what you should
Ms Karen Agustiawan, President Director, Pertamina*
Revising ineffi cient contracts: Holistically reducing
uncertainties from E&P projects
• Evaluating alternatives under different scenarios, i.e. reserve
discoveries, variations in oil prices, operating costs, and fi eld
• Cost recovery system and ‘excess profi t’ adjustment
• Hedging against exploration uncertainties of no discovery,
discovery not being commercial and costs
• Hedging against production uncertainties, derived through
operating costs and commodity prices fl uctuations
Mr Joseph Amudi Tobing, Sr Legal Counsel, Hess Limited

Click the latest brochure to get more detailed information on the list of speakers and venue.

Another good news: the reader of this blog may get 10% discount. I am still working on the arrangements with the organizers.


E&P Sharing Contracts and Agreements 2010

Saturday, March 13, 2010

Center for Energy Sustainability and Economics will be holding a very important forum this April, in Jakarta. The E&P Sharing Contracts and Agreements 2010 will be held in Jakarta 27-29 of April 2010, and will feature important figures in the Indonesian Oil and Gas Industry. This is the press release I received from the organizer, Arcmediaglobal:

Insights into the most efficient partnerships, alliances, contracts and agreements adapted to today’s economy are why this Power Forum is a must-attend event for all exploration companies from Southeast Asia, Central Asia, Russia, Africa, the Middle East, Caspian Sea and other oil-rich regions. The forum brings together the institutions, regulators, commercial and state actors, all who are directly involved in actual contracts and sharing agreements, to shed light into business-critical and contract-related issues around the various relationships, fiscal models and risk management must-haves in today’s petroleum exploration and development, including production sharing, joint operations, joint ventures, service contracts, international boundary disputes and oil & gas accounting.

 I will update more on this event. Click here for brochure.


Cost recovery in oil projects

Sunday, January 7, 2007

An op-ed piece in today's JP criticizing a government's plan in amending regulations affecting cost recovery in oil projects:
Before signing the PSC (or KKS as it is now called), the investor built an economic model, calculating his return on investment using several scenarios. He negotiated a contract expecting a certain minimum net result. If this expected net result no longer holds true because the deal was unilaterally changed, or if he is, for example, subject to sudden spurious tax levies at the central and local levels, he will demand that his economic expectations under the agreed contract be restored. If he does not get that, he may pack his bags and leave, and/or resort to arbitration.

Admittedly, there will always be a need for some degree of regulation, especially in the event of what economists call market failures. But the government should step in only when it needs to fix something. As the saying goes, if it ain't broke, don't fix it. That is the prevailing management theory and a fundamental credo of microeconomics.
Some official thinks that oil companies takes too much from cost recovery, oil company says there are not so much to be taken. I haven't look at the draft regulation so I can't say anything.