Indonesia will not extend ExxonMobil Corp’s contract to operate in a potentially important Indonesian oil development when it expires in 2010, state oil company Pertamina said.

The US-based world number one energy firm and Pertamina have been locked in talks since 2001 over the Cepu block on Java island, which government officials said could produce 10 per cent of Indonesia’s current output.
 The discovery could provide a much-needed 100,000 barrels per day boost for Indonesia, struggling to meet its 1.3 million barrel Opec quota with current production of just 950,000 barrels a day.
“We will issue the letter soon. We will not extend Exxon’s contract. That would be beneficial for this republic,” Pertamina president director Widya Purnama said.