Energy company PT Medco Internasional (MEDC) has strengthened its position in the domestic gas sector with a major acquisition from Spain’s Repsol E&P S.à.r.l., purchasing a 24 percent indirect participating interest in the Corridor Block for US$425 million (Rp6.8 trillion).

The deal, announced Thursday, June 26, 2025, was made through the purchase of Fortuna International (Barbados), Inc., and is expected to close by the third quarter of 2025, pending customary regulatory approvals. With this transaction, Repsol exits the Corridor Block entirely, transferring full control of its stake to Medco.

The Corridor Production Sharing Contract (PSC) encompasses seven producing gas fields and one oil field, all located onshore in South Sumatra, and is considered one of Indonesia’s strategic upstream gas assets.

Dominant control

Following this acquisition, Medco will control a dominant 70 percent participating interest (PI) in the Corridor Block. The remaining shares are held by State energy company PT Pertamina Hulu Energi (PHE) Corridor with 30 percent PI.

"This acquisition aligns with our strategy to own and operate high-quality assets that deliver strong cash flow," MedcoEnergi President Director Hilmi Panigoro said.

“It also reinforces our commitment to national development, with natural gas playing a key role in the transition toward a low-carbon future,” he added.

Gas produced from the Corridor Block is sold under long-term contracts to reputable buyers in Indonesia and Singapore, supporting both domestic energy security and regional supply commitments.

The Corridor Block underwent a significant restructuring in late 2021, when Medco acquired ConocoPhillips Indonesia Holding Ltd. (CIHL), which held 100 percent of ConocoPhillips (Grissik) Ltd. (CPGL) the former operator and major stakeholder of the block. ConocoPhillips previously held a 46 percent PI before exiting.

The PSC itself was renewed in December 2023, extending its validity until 2043 under a new Cost Recovery scheme, replacing the earlier gross split model. The new structure reportedly offers more favorable commercial terms to investors, ensuring long-term viability of operations.

The transaction also marks the exit of Repsol from the Corridor Block, as the company continues to rebalance its global portfolio. Repsol, a multinational energy firm with operations in over 20 countries, employs around 25,000 people and services more than 24 million customers worldwide.

Industry analysts view Medco’s increasing dominance in the Corridor Block as a bold strategic move, potentially cementing its position as a leading regional gas supplier amid growing demand for cleaner energy in Southeast Asia.

With the acquisition, Medco bolsters not only its upstream asset base but also enhances its financial stability through assets with established production and infrastructure.

The company has not disclosed funding details for the acquisition, but sources familiar with the matter indicate that financing will be sourced through a combination of internal cash flow and debt instruments.