The government approval provides a 20-year extension to the existing PSC, which would have expired in 2012.
The existing Madura Strait PSC contract was originally awarded in 1982.
The Madura BD field, which contains natural gas and natural gas liquids, is located in the Madura Strait, offshore East Java, Indonesia.
The company said that many of the requirements to bring the Madura BD field into production are in place.
In 2007, Husky signed gas sales agreements with three local companies for the sale of 100 million cubic feet per day of natural gas production and in 2008, Husky reached an agreement with CNOOC to jointly develop the Madura BD field.
A plan of development for the BD field has been approved by the Indonesian government, and front end engineering and design was completed in the second quarter of 2010.
Husky and its partner in the Madura Strait have each agreed to sell a 10% equity stake in Husky Oil (Madura) to Samudra Energy, through its affiliate SMS Development.
Following the completion of the sale, Husky and CNOOC will respectively hold a 40% equity interest in Husky Oil (Madura), with the 20% balance held by Samudra Energy.
