Indonesia to Award 7 New Oil and Gas Blocks

Indonesia's government will award seven new oil and gas blocks Friday, bringing the total number to 16 this year, a government official said Thursday.

Last month, the government offered eight blocks for open bidding, but only seven blocks finally received bids from foreign and local investors, said Iin Arifin Takhyan, the oil and gas director general at the mines and energy ministry.

He told reporters that Malaysia's Genting Bhd. withdrew its bid for the offshore Anambas Block at the Natuna islands. He didn't give details why the Malaysian company canceled its bid.

Other international companies that bid for the eight blocks include the ConocoPhillips, which bid for the onshore Palmerah Block in South Sumatra. An official with the ministry who declined to be named told Dow Jones Newswires that ConocoPhillips lost the bid to an Indonesian company.

Indonesia, the only Southeast Asian member of the Organization of Petroleum Exporting Countries, currently produces around 1.1 million barrels a day of crude oil, below its OPEC quota of 1.270 million b/d.

The government is hopeful that the country's oil output will increase by between 100,000 b/d and 150,000 b/d next year as 14 new blocks are expected to commence production.