Jakarta – Minister of Energy and Mineral Resources (ESDM), Arifin Tasrif offered oil and gas exploration to investors, at the opening of the 46th Indonesian Petroleum Association (IPA) Exhibition and Convention, held in offline and online at the Jakarta Convention Centre (JCC), Wednesday (21/9).
He said, although oil and gas production continues to decline, the government will still encourage oil and gas production to reach the target of 1 million barrels of oil per day (BOPD) and 12 standard cubic feet of gas per day (BSCFD). “Indonesia’s upstream oil and gas investment potential is still very large. We have 70 potential unexplored basins that are offered to investors,” said Tasrif.
The strategies implemented include optimising existing production, transforming resources into production, accelerating Chemical Enhanced Oil Recovery and massive exploration for major discoveries as well as unconventional oil and gas development.
After 1995, oil production continued to decline as did gas production in 2005, due to the absence of large oil reserves, lack of exploration and investment, limited financing, Covid-19 and the shift in investment to renewable energy.
Expansion to eastern Indonesia
The government will also accelerate oil and gas exploration in five working areas of Eastern Indonesia, namely Buton, Timor, Seram, Aru-Arafura and West Papua Onshore. In addition, there are four promising oil and gas projects, namely IDD Gendalo and Gehem, Jambaran Tiung Biru Field, Abadi Field and Tangguh Train-3, which are expected to increase oil and gas production by 65,000 BOPD and 3,484 MMSCFD, with a total investment of more than IDR 37 billion.
“To further increase oil and gas production, we will announce the second round of Indonesian oil offers in 2022, which consists of 5 direct bid candidates, 1 direct bid candidate available for the Pope block, 1 regular tender candidate and 1 direct bidding candidate for West Kampar,” he added.
Arifin added that the government had made several policy breakthroughs to encourage more investment in upstream oil and gas through flexibility contracts (Cost Recovery PSC or Gross Split PSC), increased terms and conditions in the bidding round, fiscal/non-fiscal incentives, online permit applications and adjustments. regulations for the unconventional.
Furthermore, to attract investment, the 2021 Oil and Gas Law will be revised so as to provide improvements to the fiscal term, assumptions and releases, ease of doing business, and contract certainty.
“In the context of low-carbon energy, the role of natural gas is very important as a transitional energy before the dominance of fossil fuels shifts to renewable energy in the long term. To strike a balance between increasing oil and gas production and carbon emission targets, we must promote low-emission technologies and innovation, for example through the implementation of CCUS,” he explained.
There are 14 Carbon Capture and Storage/Carbon Capture, Utilisation and Storage (CCS/CCUS) projects in Indonesia, but all activities are still in the study/preparation stage, and most of them are targeted to be onstream before 2030. One promising project to be implemented in the near future are Tangguh Enhanced Gas Recovery (EGR) and CCUS. The project aims to reduce carbon emissions by around 25 million tons of CO2 by 2035 and increase production to 300 BSCF by 2035.
“Tangguh EGR/CCUS can be a role model for gas development in Indonesia in the future. Currently, the government is drafting a ministerial regulation on CCS/CCUS,” he said. (Hartatik)
Photo banner: From left to right: IPA President Irtiza Sayyed, Chairman of Commission VII DPR RI, Sugeng Suparwoto, Minister of Energy and Mineral Resources Arifin Tasrif, Deputy Minister of Manpower Afriansyah Noor, Chairman of ADPMET and Governor of West Java, Ridwan Kamil, Head of SKK Migas Dwi Soetjipto, and Director General Migas Tutuka Ariadji at the opening of the 46th Indonesian Petroleum Association (IPA) Exhibition and Convention, which was held in a hybrid manner at the Jakarta Convention Center (JCC), Wednesday (21/9). (Doc: IPA)