Why ESDM Ministry struggles to sell the Akimeugah I and II WKs

The Akimeugah I and II working areas (WKs) have been offered three times by the government through an open tender mechanism. However, to date, no contractor has been selected as the winner. Most recently, the Energy and Mineral Resources (ESDM) Ministry opened the third round of the 2025 tender for the Akimeugah I and II WKs in December 2025.

Senior oil and gas industry practitioner Hadi Ismoyo believes the two oil and gas blocks possess relatively large oil and gas reserves. However, he explained that the extreme terrain and overlap with the Lorentz National Park area make development of the Akimeugah I and Akimeugah II WKs difficult.

"Several exploration wells from previous operators have indicated the presence of hydrocarbons," Hadi stated on Dec. 29, 2025.

"Additionally, ExxonMobil has successfully exploited gas with extraordinary reserves in Papua New Guinea (PNG), east of the Indonesia-PNG border, with a current capacity of up to 12 MTPA (million tonnes per annum) of LNG (liquefied natural gas)," he continued.

Hadi believes that the Akimeugah I and Akimeugah II have the potential to produce reserves relatively similar to those found in Papua New Guinea. However, he said there is still no clarity regarding the overlapping status of some of the working areas with Lorentz National Park.

The Akimeugah I block is located in the onshore areas of South Papua and Highland Papua provinces, covering an area of ​​10,791.21 square kilometers (km²). This block has substantial resource potential estimated at 15 billion barrels of oil equivalent (boe). Meanwhile, the Akimeugah II block is located in the same region, covering an area of ​​12,987.68 km². Its potential is also projected to reach 15 billion boe.

Hadi is convinced that investors are still awaiting legal and regulatory certainty regarding the boundaries of areas that can be converted into limited oil and gas WKs in the concession. He encouraged PT Pertamina to form a consortium to work on the Akimeugah I and II WKs. He believes the state-owned enterprise has the capability to develop these challenging blocks.

The contracts for both Akimeugah I and II are offered under both the cost recovery and gross split schemes. For cost recovery, the revenue sharing is set at 50:50 for oil and gas, whilethe base split is 53:47 for oil and 51:49 for gas under the gross split scheme. The firm work commitments for each of the oil and gas blocks include geological and geophysical (G&G) activites, two- and three-dimensional (2D/3D) seismic acquisition and processing, or exploration well drilling within the first three years. A signature bonus is determined through an open bid with a minimum value of US$200,000 for each of the oil and gas block.