Around 54 energy investors have made requests to the government to develop CBM (coal bed methane) in Indonesia.
Acting Director of Oil and Gas Upstream Business Development Heri Poernomo revealed data by the Directorate General of Oil and gas as of June 2008 showed there were 54 requests made to develop CBM. "CBM potential in Indonesia is huge and CBM is an alternative to oil," he said in Jakarta yesterday.
According to him, of several investors making requests to the government, four had completed their joint evaluations, three were conducting joint evaluations, and one was conducting a joint study.
One consortium that has signed a CBM development partnership contract is the PT Medco CBM Sekayu and South Sumatera Energy Inc consortium.
CBM is gas fuel contained in coal. CBM is extracted from coal layer through drilling, which will not reduce the coal content.
Despite strong interests in CBM development, the government still has to face many obstacles. As quoted from the Directorate General of Oil and Gas website, one of the obstacles was not all investors interested in CBM development had understood requirements made by the government.
Another obstacle was the widespread issuance of mining concessions by regional governments.
Concerning the obstacle, the government will revise the Minister of Energy and Mineral Resources Regulation No. 33/ 2006 on CBM Procurement
(Bisnis Indonesia, p. T1)