PetroChina International Jabung, a subsidiary of the Chinese oil and gas company, has reached an agreement with East Tanjung Jabung regency in Jambi province to supply gas to a local power station.

The decision paves the way for the company to resume its oil and gas operation within the district, which ceased in May due to licensing issues.

Elan Biantoro, a spokesman at the upstream oil and gas regulator SKKMigas, said PetroChina and East Tanjung Jabung district signed an agreement on Sep. 20, following four months of negotiation facilitated by the regulator and internal affairs ministry.

“So far there has been a lack of communication. With this agreement, the seal on the wells will be lifted soon,” Elan said on Saturday.

The district’s government closed 14 oil and gas wells operated by PetroChina on May 24 as the company did not have the necessary permits to operate them.

The Chinese company countered that it had applied for permits, but the government had been slow in issuing the necessary paperwork.

Elan said the deal was reached after PetroChina agreed to the district’s demand for gas allotment to feed the local state-owned power plant.

The company also met the local government’s demand for a corporate social responsibility program.

PetroChina is China’s biggest oil producer and the listed arm of state-owned China National Petroleum Corporation.

Indonesia is the first of PetroChina’s international oil and gas exploration and production operations, with fields in East Tanjung Jabung, Papua and East Java.

Together, these fields account for approximately 63,000 barrels of oil equivalent per day (BOEPD).

PetroChina’s net production from its Jabung operations reached approximately 16,345 barrels of oil and 265 million standard cubic feet of gas per day as of January, making it the country’s ninth-biggest oil and gas producer.