The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) stated that PT Pertamina (Persero) 's split changes in several of its oil and gas blocks are still waiting for the approval of the Minister of Energy and Mineral Resources (ESDM).
However, this additional split has the potential to increase oil reserves by 120 million barrels and gas by 1.7 trillion cubic feet. Deputy of Planning for SKK Migas, Jaffee Suardin said that discussions regarding the proposed additional split of Pertamina in several of its oil and gas blocks have now reached the final stage. Furthermore, to realize the additional split, his party needs approval from the Ministry of Energy and Mineral Resources.
"It needs approval from ESDM because there will indeed need to be something approved by the Minister of EMR," he said.
Jaffee revealed that the proposed additional split was through long discussions with his party. The reason is that this proposal was initiated by his party's efforts to seek oil and gas potential that could be developed but had not yet been included in Pertamina's long-term plan. Furthermore, his party issued a recommendation to the Ministry ESDM.
"We want to try it in the future, for 1-2 months, so that we can finish it," he said.
According to him, this additional split has the potential to generate oil and gas reserves for Indonesia without having to wait for exploration activities to be carried out. Not only that, but this step will also increase the economy of the oil and gas block for up to 10 years.
"What is being discussed now is to add approximately 120 million barrels of oil reserves and 1.7 trillion cubic feet of gas," said Jaffee.
He said the additional split proposal did not end only for Pertamina. His party will continue to look for oil and gas potentials in other working areas that can be developed in the future.
"The point is, the more aggressive and efficient," he added.
Previously, Director of Development and Production of PT Pertamina Hulu Energi (PHE) Taufik Aditiyawarman said that his party had proposed an additional split for the Mahakam Block and the Sanga-Sanga Block. In addition, his party is still reviewing the proposed changes to the results of the East Kalimantan Block, Offshore North West Java (ONWJ), and Offshore Southeast Sumatra (OSES). These five blocks are termination blocks managed by the company.
Deputy of Monetization and Finance of SKK Migas, Arief S Handoko, revealed the potential for increased gas production from oil and gas blocks in East Kalimantan or the East Kalimantan System. This is after the incentives being proposed by Pertamina for the Mahakam, Sanga-Sanga, and East Kalimantan blocks. The existence of incentives will encourage more massive operations and well drilling activities.
"In 2021, the Mahakam Block could reach more than 500 million standard cubic feet per day / MMScfd, not yet from the others," he said.
Taufik had said that if the profit-sharing was improved, his party was committed to increasing the production of the oil and gas block.
"Of course, with a better economy, it will maximize the monetization of the potential in the oil and gas block, increase reserves and future production," he said.
Pertamina signed a production sharing contract / PSC) for the Sanga-Sanga Block, East Kalimantan, and the OSES Block with a gross split scheme in 2018. Likewise, the amendment to the Mahakam Block PSC uses a cost recovery investment scheme. The ONWJ Block contract was signed in 2017.
Referring to the contract, Pertamina's profit-sharing in the SangaSanga Block is set at 49% for oil and 54% for gas. Meanwhile, in the East Kalimantan-Attaka Block, the company gets 61 percent for oil and 66 percent for gas. Furthermore, Pertamina's profit-sharing in the OSES Block is set at 68.5% for oil and 73.5% for gas.
In the ONWJ Block, Pertamina previously obtained additional splits through ministerial discretion and changes to the gross split scheme. Initially, Pertamina's profit-sharing in this block was 57.5% for oil and 62.5% for gas. At the end of 2017, this revenue-sharing amount increased to 73.5% for oil and 81% for gas. The five termination blocks worked by Pertamina are included in the list of 10 largest oil and gas producers in Indonesia.
Referring to SKK Migas data, the realization of oil lifting in the Mahakam Block was recorded at 29,361 barrels per day (BPD) from the Revised State Budget (APBN-Amendment) target of 25 thousand BPD and 558 MMScfd of gas from the target of 510 Mmscfd.
Furthermore, the oil lifting of the ONWJ Block was 28,893 BPD from the target of 27,500 BPD and gas 71 MMScfd of the target of 58 MMScfd. Following are the achievements of OSES Block oil lifting of 26,542 BPD from the target of 24,010 BPD, East Kalimantan 9,862 BPD from the target of 11,380 BPD, and Sanga-Sanga 12,515 BPD from the target of 12,030 BPD.
Investor Daily, Page-9, Saturday, Oct 24, 2020
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