BAKU, Azerbaijan, Dec.19
By Leman Zeynalova – Trend:
The Upstream Oil and Gas Regulatory Task Force (SKK Migas) intends to increase the volume of oil production in Indonesia to around 1 million barrels per day (bpd) in 2031, Trend reports citing ANTARA News.
Reportedly, in the third quarter of 2019, the country’s oil output stood on average at 750,000 bpd.
"Hence, we must double our efforts to push production while at the same time curb a drop in natural production from oil wells," said Chief of the SKK Migas Program and Communication Division Wisnu Prabawa Taher.
To this end, Taher outlined the following four steps: to prevent a drop in natural production; expediting efforts to process potential resources into ready-to-sell oil;
encouraging the application of enhanced oil recovery (EOR) at old fields; and employing massive exploration strategy.
Formerly a net oil exporter in the Organization of the Petroleum Exporting Countries (OPEC) for several decades, Indonesia now struggles to attract sufficient investment to meet growing domestic energy consumption.
Indonesia suspended its OPEC membership in January 2009, reactivated it again in January 2016, but decided to suspend its membership once more at the 171st Meeting of the OPEC Conference on 30 November 2016.
Starting in the 1990s Indonesia's crude oil production has experienced a steady downward trend due to a lack of exploration and investments in this sector. In recent years the country's oil and gas sector actually hampered national GDP growth. Oil production targets, set by the government at the start of each year, have not been achieved for a number of years in a row because most oil production stems from mature oil fields. Today, Indonesia's total of oil refineries have roughly the same combined capacity as a decade ago, indicating that there has been limited progress in oil production, resulting in the current need to import oil to meet domestic demand.
Indonesia's daily crude oil production is about 750,000 barrels, while total consumption is estimated at 1.3 million to 1.4 million barrels a day, government data show.
Recently, Indonesian president ordered an overhaul of the management of state-owned oil giant PT Pertamina, as the former OPEC member seeks to reduce crude oil imports to rein in the current-account deficit.
In recent years Pertamina has focused on taking over oil and gas fields from foreign firms whose licences have expired, in addition to spending hundreds of million of dollars drilling new wells. The company plans to build about a half-dozen new refineries over the next decade to double refining capacity and trim imports of oil products.
---
Follow the author on Twitter:@Lyaman_Zeyn