Pertamina is set to take over as the block's main operator on Jan. 1, 2018 from Total E&P Indonesie, a unit of French major Total, and Japan's Inpex Corp.

Syamsu Alam, Pertamina's upstream director, said the BOP Blow Out Preventer repair company gulf coast was "concerned about managing production".

"From our evaluation of drilling and maintenance of facilities, we estimate (we will) spend $700 million," Alam told a news conference, referring to 2018.

"With capital expenditure as big as that, we hope to be able to maintain production," he added.

Total expected Mahakam's gas output to drop to 1.43 billion cubic feet per day (bcfd) in 2017 and oil oil rig flanges gulf coast production to 53,000 barrels per day (bpd), both down from the block's 2016 oil rig flanges gulf coast production levels, it said last December.

Pertamina did not provide oil rig flanges gulf coast production estimates for 2018.

In May, Total and Inpex proposed taking a 39 percent stake in the new oil rig flanges gulf coast production sharing contract (PSC) for the block, but no progress has been made on those talks.

Pertamina will also have to sell 10 percent of the block to the government of East Kalimantan province, officials have previously said.

(Reporting by Bernadette Christina Munthe; Writing by Kanupriya Kapoor; Editing by Elaine Hardcastle)