Smooth Roads and Red Carpets for ENI

Bisnis Indonesia, Page-4, Wednesday, Oct 4, 2023

    The Indonesian oil and gas authority has rolled out the red carpet for plans submitted by the ENI-Italy company, after discovering natural gas reserves of 5 trillion cubic feet in the North Ganal Block, East Kalimantan-Indonesia.

Red Carpet for ENI ITALY

    The Ministry of Energy and Mineral Resources (ESDM) has confirmed that it will provide full support for the plan proposed by ENI to develop natural gas reserves in North Ganal, including part of the Indonesian Deepwater Development area so that it can be developed simultaneously.

the North Ganal Block By ENI-Italy

    Director General of Oil and Gas at the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that the merger of some of the Indonesian Deepwater Development (IDD) working areas would have a positive impact on Indonesia's upstream oil and gas development. The reason is, that the potential that exists in the area can be directly utilized by the facilities that are available.

    Tutuka Ariadji said we really support dividing the two IDD areas because it is good, and will reduce costs. Some can be used by existing facilities.

ENI

    ENI is planning to submit a revised Plan of Development IDD by dividing the development of the oil and gas block into two concentrations, namely the north side and the south side.

    The plan is for the southern part of the IDD to be connected to the floating production unit (FPU) of the Jangkrik Gas Field, while the northern part, which is close to the current large gas discovery location, will be connected to the North Ganal development block.

    The Ministry of Energy and Mineral Resources is currently waiting for the revised PoD so that it can be followed up immediately. The government is also committed to facilitating the acceleration of PoD approval for the block so that the timeframe for exploitation preparation can be shortened.

   Tutuka also explained that the exploration well drilled by ENI contained a very large amount of condensate to support Indonesia's oil production in the future. 

Blogger Agus Purnomo in SKK Migas

    This makes the government want these reserves to be monetized within 2 years from now. Meanwhile, the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) estimates that Eni will build a new FPU facility on the northern side of their oil and gas portfolio, namely in the stretch of the Kutai Basin, off the coast of East Kalimantan, Indonesia.

"The Jangkrik Gas Field FPU is for the South side, it looks like it will build a new hub. So, there will be new facilities, because the Jangkrik Gas Field is already full by the Merakes Block and the Muara Bakau Block," said SKK Migas Deputy for Exploitation Wahju Wibowo.

Blogger Agus Purnomo in SKK Migas

   Wahyu added that the new facilities resulting from gas processing from the North Ganal Block will also be able to be channeled to the Bontang Refinery which is currently experiencing uncertainty in gas supply, due to the problem of decreasing production in a number of oil and gas working areas.

   "If it could be developed, the current Bontang Refinery only has 2-3 trains, with supplies from North Ganal it could have 4-5 trains. "It was previously thought that the Bontang Refinery would die, now it can have a longer life," he said.

the North Ganal Block By ENI-Italy

    ENI said that the discovery of significant amounts of natural gas reserves came from the Geng North-1 exploration well in the North Ganal Block, around 85 kilometers off the coast of East Kalimantan in Indonesia.

    Based on Eni's official statement, initial estimates show that the total structure discovered is 5 Tcf of gas with a condensate content of around 400 Mbbls. The data obtained by the company also allows for faster development studies later.

     The Geng North-1 well was drilled to a depth of 5,025 meters in a water depth of 1,947 meters; passing through a gas column approximately 50 meters thick in a Miocene sandstone reservoir with good petrophysical properties.

    The well production test (DST) has been successfully carried out for a comprehensive assessment of the gas discovery. Although limited by testing facilities, this study allows for estimates of the well capacity of up to 80-100 MMscfd and approximately 5-6 kbbls of condensate.

    It is also believed that the findings will contribute significantly to the formation of a new gas production hub in the northern part of the Kutai Basin. In addition, the findings will be connected to the Liquefied Natural Gas/LNG facility at the Bontang refinery, in East Kalimantan, Indonesia. Apart from Geng North, it is estimated that there are more than 5 trillion cubic feet of gas in undeveloped fields within the oil and gas block.

    The Indonesian oil and gas authority also believes that these findings can encourage more massive exploration investment in the future, considering that the potential for oil and gas in Indonesia is still very promising because there are still 68 basins out of a total of 128 oil source basins that have not been drilled.

Good News on the Discovery of a Large Oil Source by ENI ITALY

Bisnis Indonesia, Page-4, Tuesday, Oct 3, 2023

    The Indonesian oil and gas industry has received good news again from the discovery of large volumes of oil and gas reserves by the giant company from Italy, ENI. It is hoped that this positive sentiment can increase the attractiveness of the oil and gas sector.

ENI ITALY

    The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) revealed that ENI had succeeded in finding natural gas reserves in the North Ganal Working Area, East Kalimantan-Indonesia, with an initial gas estimate of 5 Trillion Cubic Feet (Tcf).

    With an initial estimate of discovered resources of around 609 million barrels of oil equivalent, the report makes the discovery at the Geng North-1 well one of the world's top three exploration discoveries this year.

Blogger Agus Purnomo in SKK Migas

    Head of SKK Migas Dwi Soetjipto said that this finding would be one of the giant discoveries that would significantly increase gas reserves to support a sustainable increase in Indonesia's oil and gas production in order to achieve the oil production target of 1 million Barrels of Oil Per Day (BOPD), and gas of 12 billion cubic feet per day (BSCFD) in 2030.

    It is believed that this giant discovery can encourage more massive exploration investment in the future, considering that Indonesia's oil and gas potential is very promising because there are still 68 basins out of a total of 128 oil source basins that have not been drilled.

 Dwi Soetjipto said we hope that the discovery of gas reserves in North Ganal by one of the International Oil Companies [IOC] will encourage more other IOCs to enter Indonesia.

the North Ganal Block ENI

    SKK Migas immediately carried out intensive coordination with ENI to formulate the next stages so that this giant discovery could be immediately monetized.

    The Indonesian oil and gas authority will encourage the discovery of gas reserves to reach the production stage, so that it can increase supply to support development, including gas downstream which is currently being advocated by the government.

"This is also supported by the gas infrastructure that is already available in East Kalimantan, so it is hoped that it can be developed quickly and efficiently," said Dwi Seotjipto.

the North Ganal Block ENI Working Area

    ENI said that the discovery of significant amounts of natural gas reserves came from the Geng North-1 exploration well in the North Ganal Block, around 85 kilometers (km) off the coast of East Kalimantan.

    Based on Eni's official statement, initial estimates show that the total structure discovered is 5 TCF of gas with a condensate content of around 400 Mbbls. The data obtained will allow for faster development studies.

    The Geng North-1 well was drilled to a depth of 5,025 meters in a water depth of 1,947 meters, passing through a gas column approximately 50 meters thick in a Miacene sandstone reservoir with good petrophysical properties.

    The well production test (DST) has been successfully carried out for a comprehensive assessment of the gas discovery. Although limited by testing facilities, this study allows for estimates of the well capacity of up to 80-100 MMscfd and approximately 5-6 kbbls of condensate.

    It is also believed that the findings will contribute significantly to the formation of a new gas production hub in the northern part of the Kutai Basin, East Kalimantan. 

    Apart from that, these findings will be connected to the Liquefied Natural Gas/LNG facility in Bontang, East Kalimantan-Indonesia. It is estimated that apart from Geng North, more than 5 Tcf of gas is located in undeveloped fields within the oil and gas block. The potential for significant multi-Tcf exploration is being refined through ongoing studies.

    The Geng North discovery is close to the Indonesia Deepwater Development (IDD) area which includes several old discoveries that are not immediately developed in the Rapak and Ganal Blocks, where Eni has just announced the acquisition of Chevron shares, increasing ENI's participating shares, and acquiring Chevron operator ownership.

    Eni also promised to seek to merge the two oil and gas working areas for more optimal gas development. the acquisition also provides an opportunity to accelerate the development of the Gendalo and Gandang gas projects with gas reserves of around 2 TCF through the Jangkrik Gas Field facilities operated by Eni.

ACCELERATION

    Meanwhile, the Ministry of Energy and Mineral Resources (ESDM) is targeting the discovery of giant gas reserves from the Geng Nordi-1 exploration well, North Ganal Block, ENI hopes to produce production within the next 2 years.

    The Director General of Oil and Gas at the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that his party would facilitate the accelerated approval of the Plan of Development (PoD) plan for the block. The hope is that the timeframe for exploiting preparations can be accelerated.

“We will facilitate this so that this happens quickly. "We are targeting that in the next 2 years, we will be able to get first gas," said Tutuka Ariadji.

    Even so, Tutuka reminded Eni of a number of homework that had to be completed when developing the gas reserves discovery, such as the vast expanse and the very challenging depth of the oil and gas reserves.

"It's a very large oil expanse, the thickness is okay and satisfying, but it's very wide," he said.

    The lengthy licensing process in the upstream oil and gas sector has become a public highlight to the point that the government is pushing for the issuance of special regulations that regulate the simplification and acceleration of basic requirements and licensing for upstream oil and gas activities in order to increase competitiveness and certainty of investment for Cooperation Contract Contractors (CCC/KKKS) in Indonesia.

    ReforMiner Institute Founder & Advisor Pri Agung Rakhmanto said that several times the discussion of the technology and economics of a proposed PoD was too detailed and very technical, making the process take a long time.

    This has not been supplemented by finalizing discussions regarding the PoD's decision itself, so KKKS has to wait longer to get certainty.

    In investment, there is a time value of money. The longer the time, the relative decrease in economic value. This also adds to the uncertainty factor if there is no decision soon.

    Pri Agung Rakhmanto also suggested that the government issue a special regulation that regulates the maximum time span for the PoD approval process. The hope is that the process of discussing and approving oil and gas field development plans in Indonesia can be faster.

    Pri Agung also sees the same thing happening in the upstream oil and gas procurement process, where technical verification and checking processes before approval related to procurement take a very, very long time. As a result, KKKS feels that investment procedures in Indonesia are still too long and increase costs.

Overcoming oil and gas BIG challenges in Indonesia

    The allure of upstream oil and gas investment in the country is increasingly attractive, as reflected in the commitment of a number of Cooperation Contract Contractors (KKKS) to continue investing in exploration activities.

    A number of global oil and gas giants have also agreed to achieve a large target of oil production of 1 million barrels per day (BPD) and gas of 12 billion standard cubic feet per day (BSCFD) by 2030.

    Through the signing of the Bali Commitment which was carried out at the CEO Forum at the 2023 International Convention on Indonesian Upstream Oil and Gas at the Bali Nusa Dua Convention Center, Badung Regency, Bali, Thursday, September 21. 

    The KKKS CEOs also promised to prepare a massive 2024 work program and budget, aggressive, and efficient. According to reviews by CEOs of international and national oil and gas companies, Indonesia is still an important portfolio. 

ENI ITALY

    Starting from oil and gas companies from Italy, namely ENI, ExxonMobil (United States), Petroliam Nasional Berhad or Petronas (Malaysia), Repsol SA (Spain), British Petroleum (England), to PT Medco Energi Internasional Tbk, and PT Pertamina ( Persero) invests more heavily in the oil and gas sector.

Roberto Daniele

    Director of ENI Muara Bakau BV, Roberto Daniele, said he was serious about investing more intensively in the exploration side of oil and gas fields. Currently, ENI together with PT Pertamina (Persero) have established strategic cooperation to carry out joint exploration in the Mahakam Block. 

the Mahakam Block

This collaboration is expected to increase oil and gas reserves. Roberto Daniele said ENI Muara Bakau BV is collaborating with Pertamina to explore the oil block in Mahakam to look for other oil and gas sources throughout Indonesia.

    Apart from that, ENI will also carry out more massive drilling for wells and exploration in the next 4 years. According to Roberto Daniele, this commitment shows Indonesia's important position in the company's portfolio. 

    Moreover, Indonesia still has large oil and gas reserves. Based on records from the Ministry of Energy and Mineral Resources, Indonesia's proven natural gas reserves even reach 41.62 trillion cubic feet (TCF). Apart from that, Indonesia still has 68 potential basins that have not been explored.

Carole Gall

    President of ExxonMobil Indonesia Carole Gall said that Indonesia has all the segments that ExxonMobil must offer. We have upstream and downstream such as fuel, lubricants, chemicals, and energy transition. Of all the Exxon affiliates in the world, it is rare to have all segments in one place together, but Indonesia has it all. 

    It is not surprising that ExxonMobil remains committed to continuing exploration investments in a number of fields and open areas. Carole Gall said ExxonMobil would drill again in Banyu Urip for 1.5 years.

    Nevertheless, a number of problems still confront the national upstream oil and gas industry, at least There are a number of crucial things that investors should note, including contract certainty, competitive and durable regulations, and ease of investing. 

    The Indonesian government is asked to increase the competitiveness of investment in upstream oil and gas by improving a number of fiscal and non-fiscal policies at a time of increasingly tight competition with a number of countries.

    In accordance with the above, Carole Gall asked the Indonesian government to improve the terms and conditions of upstream oil and gas, especially related to the terms and procedures for procurement of goods and services and auctions for oil and gas projects after approval of the Plan of Development/PoD for oil and gas fields have been obtained by the contractor. 

    According to Carole Gall, the process of procuring goods or auctioning oil and gas projects that is too long makes the return on investment and sustainability of the project unattractive for investors.

    Similar complaints were also made by other KKKS, including Petronas. This oil and gas company from Malaysia highlights the issue of certainty in contracts and fiscal terms in the oil and gas industry. 

Yuzaini Bin Md Yusof

    Petronas will support the Indonesian government to produce 1 million barrels of oil. Petronas Indonesia CEO Yuzaini Bin Md Yusof said Petronas would explore new areas in Indonesia.

INVESTMENT OPPORTUNITIES

Blogger Agus Purnomo in SKK MIGAS

    Meanwhile, Dwi Soetjipto, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK MIGAS), emphasized that Indonesia continues to Offer investment opportunities in the oil and gas sector and is ready to improve fiscal policy and provide various incentives. 

    Dwi Soetjipto said that in overcoming the energy trilemma, a broader collaborative effort is needed between the government, IOC, NOC, and policymakers, namely the Indonesian government. In line with this, investment support is needed so that exploration and development activities for oil and gas fields can be carried out on a massive scale.

    Responding to various input and complaints submitted by energy observer investors and founder of the ReforMiner Institute, Pri Agung Rakhmanto assessed the need for regulations regarding the latest time limit from processing to reaching the PoD approval decision. Pri Agung Rakhmanto said that the longer it takes, the relative economic value will decrease, and also increase the uncertainty factor if there is no decision immediately.

    Meanwhile, based on SKK MIGAS calculations, the oil and gas sector requires a very large investment of more than US$ 20 billion per year to support the 2030 oil and gas production target. Overall, the funding requirement reaches at least US$ 186.7 billion. to be able to achieve the oil production target of 1 million BOPD and natural gas 12 BCSFD by 2030.

Bisnis Indonesia ,Page-4-Saturday, Sept 23, 2023

Petronas Interested in Working on the Masela Block

    The Special Task Force for Upstream Oil and Gas Activities (SKK Migas) stated that a Malaysian oil and gas company, Petronas, expressed interest in working on the Masela Block, replacing Shell, which had left the largest gas project in Indonesia.

Petronas

    Petronas is also interested in entering into cooperation with Pertamina in terms of replacing Shell if possible. This is the latest development regarding Shell," said Head of SKK Migas Dwi Soetjipto in a hearing with Commission VII.

The Masela Block

    Apart from Petronas, previously there were two companies that were known to be interested in replacing Shell in acquiring a 35% stake in the Masela Block, namely Pertamina and ExxonMobil. Dwi said Pertamina had opened the Masela Block data room this November. It is hoped that Pertamina can submit a Non-Binding Offer to Shell.

ExxonMobil

    The government is targeting that discussions on the acquisition of Shell's participating interest (PI) in the Masela Block by Pertamina can be completed this year. One of the main conditions for reaching an agreement is the certainty of PI's acquisition value. According to Dwi, Pertamina must find an agreement with Shell to get into the Masela project.

Shell

    According to Dwi, Shell already has a minimum value base that must be prepared by Pertamina. This value is the total funds that have been spent by the company while being Inpex's partner in Masela.

Blogger Agus Purnomo in SKK Migas

"Pertamina is negotiating with Shell. SKK Migas monitors and provides direction so that Shell sells at moderate prices. To keep the project going. We wrote to Shell to support the divestment. Around US$1.4 billion has been spent by Shell," Dwi said.

Inpex Corporation

    Meanwhile, for Pertamina, there is ExxonMobil which was also offered by Inpex to conduct the study. SKK Migas said Dwi hopes that there will be opportunities for cooperation between Pertamina and ExxonMobil to open again, instead of the scent of competition. However, it all comes back to the management of each company whether to continue the collaboration as it has been in the Cepu block.

"If all this time ExxonMobil is also conducting studies, it could be a potential collaboration with Pertamina. But we'll see now that each study has its results, whether we want to continue or not," said Dwi.

IDD Project

    Meanwhile, Dwi also stated that the Indonesia Deepwater Development (IDD) project is expected to start running in early 2023, due to the certainty that the replacement operator for PT Chevron Pacific Indonesia will be completed by the end of this year.

Chevron

“Chevron has decided to leave the IDD project. Now there is a potential replacement. IDD could run next year," said Dwi.

ENI

    According to information, an Italian oil and gas company, ENI, is rumored to be controlling 62% of Chevron Pacific Indonesia's (CPI) participating interest in the Indonesia Deepwater Development (IDD) Gas Project. The IDD project has the potential to produce up to 844 million standard cubic feet of gas per day (MMscfd) and 27,000 barrels of oil per day (BOPD). The plan is for the project to be targeted onstream in the fourth quarter of 2027.

Investor Daily, Page-4, Thursday, Nov 17, 2022

SKK Migas Expects Onstream Schedule to Match POD

    The Abadi gas field project in the Masela Block is delayed in production in 2030. Meanwhile, the Special Task Force for Upstream Oil and Gas Business Activities or SKK Migas still hopes that the onstream schedule will match the development plan.

Inpex Masela Ltd and Shell

    The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) asked Inpex Masela Ltd and Shell as the operator of the Masela Block to carry out the Masela Block Liquefied Natural Gas (LNG) investment in accordance with the approved Plant of Development (PoD). The Masela Block LNG project is agreed to be completed and start production by the end of 2027.

Blogger Agus Purnomo in SKK Migas

    The Deputy of Operations for the Special Unit for Upstream Oil and Gas Business Activities (SKK Migas), Julius Wiratno stated that his party continues to push for the project to be completed in accordance with the approved PoD. SKK Migas also said that it had not yet received a revision proposal from Inpex.

Inpex

"SKK Migas to this day continues to push for implementation according to the approved PoD, for immediate production as soon as possible. We have not received a revision proposal from Inpex at all and we are still fighting for acceleration efforts," said Julius.

    Julius emphasized that the government through SKK Migas is still encouraging Inpex's investment in Masela, this must be realized immediately. Because some preparatory work has been and is being started, such as the approval of the Environmental and Impact Analysis (AMDAL), metocean surveys, and land acquisition.

Takayuki Ueda

    Previously, Inpex CEO, Takayuki Ueda explained, that Inpex is conducting comprehensive size studies such as the introduction of carbon capture, utilization, and storage facilities, known as CCUS.

the Masela Block LNG

    The CCUS installation is intended to make the Masela Block LNG project more environmentally friendly, but the project could be delayed until 2030.

"SKK Migas has asked Inpex to immediately revise the POD, if that is what is desired, for us the planning team, in particular, can immediately conduct a review and evaluation," explained Julius.

    As is known, currently Inpex Masela Ltd and Shell as the operator of the Masela Block are revising the PoD of the oil and gas working area that is included in the National Strategic Project (PSN). The PoD revision relates to the inclusion of CCUS. This is done so that the assets of the Masela Block in this case the Masela LNG can be said to be competitive because it has green energy requirements.

    The majority of Masela Block's participating shares are 65 percent owned by Inpex Masela. The rest is owned by Shell. But Shell has said it will leave the block. However, the plan failed to materialize because there were no investors who wanted to buy Shell shares.

    In addition to the Masela Block, SKK Migas also hopes that the Indonesia Deepwater Development (IDD) project located in the Kutai Basin, East Kalimantan, can be completed immediately and start production in the fourth quarter of 2025. The IDD project is a development project for five deep-sea gas fields that are carried out in an integrated manner to meet the gas needs of the domestic market and the Bontang LNG Plant. The IDD project has production reaching 844 MMscfd for natural gas and 27,000 barrels of oil per day (BOPD).

the IDD project Chevron

    In the IDD project, Chevron acts as the operator. The company controls 62% of the participating interest or interest (PI). The rest is controlled by ENI with a 20% stake and Sinopec Group 18%. However, the continuation of this mega project is still uncertain. Because, since 2020, Chevron declares to discontinue the IDD project.

ENI

"For this IDD project, the update now is that the operator Chevron Pacific Indonesia (CPI) is still looking for a replacement operator," said Julius.

DIFFICULT MISSION

    On the other hand, the government has targeted oil lifting of 1 million BOPD and gas of 12 BSCFD by 2030. However, this target is impossible to achieve without new large-scale oil and gas projects. Previously, the government through the Directorate General of Oil and Gas together with SKK Migas and cooperation contract contractors [KKKS] had identified the planned production profile of each KKKS and it was known that total oil production would reach 1 million BOPD in 2030.

    The government has also prepared several strategies to increase production, namely routine work programs such as infill drilling/step out in existing fields, and workover/well service. In addition, acceleration of the transformation of resources into production is also carried out, by accelerating new PoDs and pending PODs.

    An energy and oil economist from Trisakti University Pri Agung Rakhmanto said that without a new large-scale oil and gas project the oil lifting target of 1 million bopd would not be possible to achieve.

"To achieve the oil and gas production target of 12 MMscfd and 1 million BOPD, there needs to be a new project on a large scale," said Pri Agung.

    According to him, efforts to increase the production of existing oil and gas fields are not sufficient to achieve the government's ambitious targets.

“If it's EOR, we need EOR on a large-scale oil and gas field. The current EOR has just been done on a small scale. EOR and other efforts can only stop the rate of decline in production in existing fields so that it doesn't decline further," he explained.

    Pri Agung is of the view that this 1 million BOPD is not worthy of being called a target because there is no clarity on the details of the work program. For example, from which field the production target was produced.

    The Executive Director of the Reforminer Institute Komaidi Notonegoro also said the same thing. According to him, without finding large reserves, the target of 1 million BOPD is just wishful thinking.

"To be able to reach 1 million BOPD, it is calculated that additional production from large-scale oil and gas fields or the majority is generated from large-scale investments made by major International Oil Companies [IOCs]," said Komaidi.

Jambaran Tiung Biru in Central Java

    Currently, Indonesia has four giant oil and gas projects, namely, Jambaran Tiung Biru in Central Java, the Abadi Field in the Masela Block in the Arafura Sea, IDD in the Kutai Basin in East Kalimantan, and Tangguh Train 3 in Papua. Unfortunately, these projects are expected to be completed longer than the target set. The reason is, recently, the foreign oil and gas giant that manages this mega project has stated that it will leave Indonesia.

Bisnis Indonesia, Page-4, Wednesday, February 23, 2022

Selling Oil and Gas Blocks, Owners Are Still Looking For Strategic Partners

    Sales of oil and gas blocks during the Covid-19 pandemic created challenges. Oil and gas investors who will leave continue to look for buyers who are currently still waiting and see.

    There are four oil and gas blocks that will be sold this year. Namely, Chevron's IDD Block, ConocoPhilips' Corridor Block, Inpex's Masela Block, and Pertamina's Rokan Block on August 9, 2021.

Blogger Agus Purnomo in SKK Migas 

    Head of Program and Communication of SKK Migas Susana Kurniasih revealed, the process of selling oil and gas blocks is still long. The latest update is a notification by ConocoPhilips for a permit request to the Directorate General of Oil and Gas, Ministry of Energy, and Mineral Resources (ESDM) to disclose data. So the process is still early, so far there has been no update on whether there is a follow-up process," said Susana.

    Although the process is ongoing, Susana ensures that activities in Field will continue as usual. Quoted from the official ConocoPhilips website, the participating shares in the Corridor Block are 54% owned by the USA company, the remaining 36% by Talisman, and 10% by Pertamina.

    In 2019, ConocoPhilips signed a gross split cooperation contract to continue the contract in the Corridor Block for 3 years from the end of the contract in 2023. This means that management will continue until 2026 before being continued by Pertamina.

Repsol

    In the new contract, there is a change in the number of participating shares with the composition of ConocoPhillips (Grissik) Ltd. (46%), Talisman Corridor Ltd. (Repsol) (24%), and PHE Corridor (30%). Participating Interest owned by the holders of interest includes 10% PI which will be offered to Regional Owned Enterprises.

    In addition to the Corridor Block, the oil and gas block divestment action is now taking place in two other blocks, namely Masela and Indonesia Deepwater Development. Of the three, only Block IDD will soon find a replacement partner. Chevron is said to be holding final point discussions with the Italian oil company, Eni.

Eni

    Meanwhile, the Rokan Block will also be sold. Pertamina is looking for a strategic partner. Executive Director of the National Oil and Gas Company Association (Aspermigas) Moshe Rizal said that the search for existing partners would likely affect operations. The current condition is not easy to find a replacement partner.

"Hopefully, after conditions improve, it can increase investment interest from outside, because I see that there are many incentives being prepared," said Moshe.

Kontan, Page-12, Thursday, July 22, 2021

Upstream Oil and Gas Insurance Claim Reaches US$ 48 Billion

    Claims paid by insurance consortiums for upstream oil and gas projects carried out by Cooperation Contract Contractors (KKKS) include industrial assets, wells and LNG assets, reaching around US$ 48 billion. In the future, the claim value is expected to increase in line with the improvement in the upstream oil and gas industry triggered by the increase in world crude oil prices.

"Our consortium (Jasindo being the leader) has provided protection for 128 off-shore and on-shore oil and gas blocks. This is a lot, and Alhamdulillah we can carry out our role to protect it very well," said Director of Strategic Business of PT Asuransi Jasa Indonesia (Jasindo), Syah Amandaris in a webinar entitled The Role of Insurance in Supporting Upstream Oil and Gas Activities.

    According to him, the insurance consortium has done a good job of providing protection in every project run by the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) or Cooperation Contract Contractors (KKKS).

"Several incidents that occurred in upstream oil and gas projects have made claims payments to project owners so that the losses experienced can be reduced," he said.

    Meanwhile, the claim value paid by the Insurance Consortium for SKK Migas and KKKS construction projects reached around US$ 524.16 million. He explained that from 2010 to 2021, the consortium, which is also led by PT Jasindo, has paid 121 claims for both assets and construction.

“If the number of claims is detailed, it consists of 97 claims for assets with a value of USD323.32 million. The remaining 24 claims are for construction projects with a value of US$ 200.83 million,” he said.

Blogger Agus Purnomo in SKK Migas

“We consortium play an important role in upstream oil and gas projects. It is conceivable that if the project is not insured, the cost incurred by the state through SKK Migas or KKKS is when undesirable things happen," he added.

    Furthermore, he said, from his experience in handling claims on upstream oil and gas projects, there are three examples of megaprojects whose insurance claims were successfully paid due to interruptions during project execution.

Eni

“The first is the Eni Muara Bakau BV offshore project – Jangkrik Gas Field Development Project in 2014 with a claim value of US$ 2.53 billion. Then BP Berau Ltd's offshore and onshore project – LNG Train 3 Tangguh Expansion Project in 2017 with a value of US$ 450 million (offshore) and US$2.5 billion (onshore),” he said.

PT Pertamina EP Cepu (PEPC)

"Then the onshore project PT Pertamina EP Cepu (PEPC) - Jambaran Tiung Biru Gas Unitization Project with a claim value of US $ 860.87 million in 2017 ago," Aris.

Investor Daily, Page-10, Thursday, July 15, 2021