The pandemic has made the target of 1 million barrels per day of natural oil production by 2030 even more challenging. Apart from exploration, several other strategies will be taken to increase production.
Until the end of March 2021, the realization of ready-to-sell production or oil lifting was 676,200 barrels per day or still lower than the State Budget (APBN) target of 705,000 barrels per day. The Covid-19 pandemic in 2020 has caused investment in upstream oil and gas to decline drastically and the number of wells drilled. This condition makes the production target of 1 million barrels per day in 2030 even more challenging.
Likewise, natural gas lifting, which in the first quarter of 2021 was realized as much as 5,539 million standard cubic feet per day (MMSCFD). In the APBN, the target for natural gas lifting is 5,638 MMSCFD. However, natural gas lifting is currently still higher than the realization in 2020 of 5,462 MMSCFD.
Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Dwi Soetjipto, Monday (26/4/2021), said that the decline in oil lifting in the first quarter of 2021 was influenced by the Covid-19 pandemic since last year. Until the end of 2020, investment in the upstream oil and gas sector dropped dramatically and resulted in low Wells drilling to boost production. Last year, there were 240 wells drilled, and this year 616 wells were planned.
"From year to year, the realization of oil lifting has always been lower than the target of the APBN. This year, we strive so that lifting is not much different from last year's realization. The low investment in 2020 due to the Covid-19 pandemic has resulted in a drastic decrease in production, "Dwi said in a press conference on the Upstream Oil and Gas Performance Exposure for the first quarter of 2021 in Jakarta.
Dwi added, to reach the production target of 1 million barrels per day in 2030, apart from intensifying exploration to find new reserves, several strategies were taken to increase production. The strategy is to optimize production in existing fields, apply enhanced oil recovery (EOR) methods, and accelerate the status of reserves to production.
SKK Migas noted that the Cepu Block in East Java, which is operated by ExxonMobil Cepu Ltd (EMCL), is currently the largest contributor to oil production in Indonesia, which is 213,000 barrels per day.
Next is the Rokan Block in Riau, which produces 165,000 barrels per day. The operation period of the Rokan Block by PT Chevron Pacific Indonesia (PCI) will end in August and the next management will be handed over to PT Pertamina (Persero).
From the investment side, SKK Migas targets this year's realization to be 12.4 billion US dollars, higher than last year's realization of 10.5 billion US dollars. Until the first quarter of 2021, the realization of upstream oil and gas investment was the US $ 2.4 billion. The state revenue for the same period was 3.29 billion US dollars or 45 percent of the target of 7.28 billion US dollars.
Exploration
Separately, the Executive Director of the ReforMiner Institute, Komaidi Notonegoro, said that massive exploration is the most important way to obtain new sources of oil and gas reserves in Indonesia. Moreover, the government has repeatedly stated that out of 128 basins in Indonesia, as many as 70 basins have not been studied at all. Apart from that, the government must also be able to create an attractive upstream oil and gas investment climate for investors.
"No more changes in contracts or regulations. This concerns the certainty of trying. If this still happens, investors will rethink investing in Indonesia and it is possible for them to choose other countries that are more attractive, "he said.
At the end of 2019, Pertamina through its subsidiary, PT Elnusa Tbk, started a two-dimensional seismic survey to find oil and gas reserves in Indonesian waters. This survey, which crosses the sea along 30,000 kilometers, is the largest survey in the Asia Pacific region in the last 10 years. The survey started from the waters around Bangka Island, Bangka Belitung, to the waters around Seram Island, Maluku.
According to the Head of the SKK Migas Exploration Planning Division Shinta Damayanti, the exploration results by Pertamina are still being evaluated. The government wants the evaluation data to be made public and is scheduled to be known in July. It is stated that from the results of the exploration there are several prospective areas (there are oil and gas reserves).
"Pertamina has conducted a joint study with other parties in East Java and it is estimated that (in that area) will become a new upstream oil and gas working area. The data from the seismic survey will be useful for investors, "said Shinta.
Kompas, Page-9, Tuesday, April 27, 2021
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