Jakarta – Community leaders in an oil-rich Indonesian province have threatened to block the operations of a Caltex affiliate unless Jakarta reviews a decision to extend its contract by one year, a report said Monday.

A people's congress attended by some 200 community leaders in Riau on Sumatra island on Saturday gave President Megawati Sukarnoputri a deadline to review the contract extension for PT Caltex Pacific Indonesia, the Kompas daily said.

Locals want a greater share of profits from the project and more jobs for locals.

The Coastal Plain Pekanbaru (CPP), operated by the Caltex affiliate, has 435 oil wells producing 750,000 barrels of oil per day.

The people's congress is setting up the "Riau Action To Conquer the CPP Block" (Aruk) to block Caltex operations if necessary, said community leader Al Azhar. He gave no details. "On August 9, Aruk will take action if the president does not review the presidential decree extending the production-sharing contract," Al Azhar told Kompas.

On Friday Megawati approved a one-year extension for Caltex, whose current contract expires on August 8. For the past year or so residents in Riau have been seeking a larger share of Caltex's profits. Their campaign received a boost with the implementation of the government's shaky decentralization process in January, which gave greater powers to regions to administer their own resources.

Kompas said the people's congress demanded that if the government extend the contract Caltex should earmark 30 percent of net profits for Riau, or about 26 million dollars, and employ more locals.

The head of the Riau provincial oil company PT Riau Petroleum, Muchtar Achmad, has said the figure of 26 million dollars had been calculated on an anticipated 62-million-dollar profit Caltex would make by extending its contract a year. Caltex's production-sharing contract with the state oil company Pertamina provides for an 80-20 split in profits, with the lion's share going to the government.

Riau has seen the rise of a peaceful separatist movement since the fall of authoritarian president Suharto in 1998. Its leaders say the province was for decades drained of resources without receiving significant returns. Sacked president Abdurrahman Wahid repeatedly cited Riau as one of the regions that would seek independence if he was ousted. The national assembly dismissed Wahid on July 23 and appointed his vice president Megawati to replace him.

Under decentralisation, the regions are entitled to up to 30 percent of oil profits and 15 percent of gas profits. Provincial officials have complained that funds have been slow to reach them from the national capital and are pushing the companies themselves. Investors meanwhile have complained that the newly-empowered regional chiefs are excessively raising taxes and discouraging new investment.