Transfer to Manage Block Rokan Still Rolling

Three months before the end of the Production Sharing Contract / PSC of PT Chevron Pacific Indonesia (CPI) in the Rokan Block, the process of transferring the management of this block to PT Pertamina (Persero) is still ongoing. Chevron stated that the transfer of Kelola shows significant progress in maintaining the continuity of operations and production of the Rokan Block after 9 August.

Chevron Pacific Indonesia (CPI)

Managing Director of Chevron Indo Asia Business Unit and President Director of CPI, Albert Simanjuntak, said that his party continues to work so that the termination and transition process can be reliable and smooth. This is because the Rokan Block is a strategic asset that is important for state and regional revenues, the community's economy, and national energy security.

The main aspects of the termination process are the termination checklist according to government regulations, asset reporting, and project report closure. As for the transition process, its main aspects include drilling programs, information technology, data migration, management of goods and services contracts, operational procedures and work permits, human resources (HR), and others.

"Progress from these main aspects is very significant and is expected to be complete before the transfer of management later," said Albert.

For the termination process, Chevron has completed the PSC provisional checklist termination document on February 25, 2021. Then the asset reporting has reached 81%, where about 109 thousand assets have been physically inspected and reported. Meanwhile, the closure of project reports reached 70% or around 2940 reports that have been completed.

As part of monitoring, the process of verification and validation (V&V) of exploration and exploitation data of the Rokan Block is currently underway by the Center for Data and Information Technology (Pusdatin) of the Ministry of Energy and Mineral Resources and SKK Migas. 

Blogger Agus Purnomo in SKK Migas

    The V&V process was carried out on approximately one million items of printed documents, magnetic and optical media, and rock samples. The process is expected to be completed this May. CPI also seeks to ensure the readiness of its employees.

"Blok Rokan's performance is solid as long as it is due to the human resource factor behind it, namely employees with built-in expertise, culture, and work ethic. We are optimistic that they will be able to maintain the performance of the Rokan Block and can contribute significantly to new companies, "said Albert.

Chevron has submitted all personnel and organizational data to SKK Migas. With the transfer of management of the Rokan Block, almost all employees of PT CPI will switch their employment status to the new operator. Parallel Well Drilling, the drilling program in the Rokan Block is ongoing to maintain production levels. Since its inception in late December 2020, to date, Chevron has successfully drilled 55 wells, including 11 conversion wells, by operating six drilling rigs and one conversion rig.

the Rokan Block by Chevron

The procurement process for additional rigs is ongoing to meet the target of drilling 192 wells in the Rokan Block by CPI and PT Pertamina Hulu Rokan (PHR) this year.

"We continue to coordinate intensively with SKK Migas and PT Pertamina Hulu Rokan (PHR so that the drilling program can proceed as expected. The collaboration is very solid because all parties share the same passion and commitment, ”said Albert.

The Rokan Block is one of the largest oil and gas blocks in Indonesia. However, the production of this oil and gas block continues to decline over time. Referring to SKK Migas data, in 2011, the Rokan Block still produced oil at around 356.98 thousand BPD or contributed 39.56% of the total national oil production at that time at 902.35 BPD. 

    However, referring to SKK Migas data, last year, oil lifting in this block was only 174,424 BPD or 24.62% of the total national oil lifting of 708,488 BPD. In 2021, the Rokan Block is targeted to produce oil of 165,002 BPD.

Investor Daily, Page-10, Tuesday, May 18, 2021

Drilling for the Rokan block continues

 

    PT Chevron Pacific Indonesia and PT Pertamina Hulu Rokan (PHR) continue to target drilling 192 wells in Block Rokan Riau this year.

PT Chevron Pacific Indonesia

    In particular, PT Chevron Pacific Indonesia (CPI) has drilled 55 wells in the production rate containment activities in the Rokan Block which will be transferred to PT Pertamina Hulu Rokan (PHR) in August 2021.

    Managing Director of Chevron Indo Asia Business Unit & President Director of PT Chevron Pacific Indonesia Albert Simanjuntak explained that the drilling program in the Rokan Block is continuing to maintain production levels.

    Since starting at the end of December 2020, according to him, PT CPI has successfully drilled 55 wells, including 11 conversion wells, by operating six drilling rigs and one conversion rig.

    The process of procuring additional rigs is underway to meet the target of drilling 192 wells in the Rokan Block by 2021.

Blogger Agus Purnomo in SKK Migas

"We continue to coordinate intensively with SKK Migas and PHR so that the drilling program can run as expected. The collaboration is very solid because all parties have the same passion and commitment, ”he said in a statement on Monday (17/5).

    For the termination process, CPI has completed the PSC provisional checklist termination document on February 25, 2021. It has reached 81% for asset reporting, with approximately 109,000 assets that have been physically inspected and reported. The closure of project reports reached 70% or around 2,940 reports that have been completed.

    Currently, the process of verification and validation (V&V) of exploration and exploitation data of the Rokan Block is underway by the Center for Data and Information Technology (Pusdatin) ESDM and SKK Migas as part of monitoring.

    The V&V process was carried out on approximately 1 million items of printed documents, magnetic and optical media, and rock samples. The process is expected to be completed this month.

“The CPI team continues to work hard to realize a safe, reliable, and smooth termination and transition process. The Rokan block is a strategic asset that is important for state and regional revenues, the community's economy, and national energy security, "he said.

    Albert said the CPI is also trying to ensure the readiness of its employees. Meanwhile, CPI has submitted all personnel and organizational data to SKK Migas.

    

the Rokan Block

    Along with the transfer of management of the Rokan Block, almost all CPI employees will change their employment status to the new operator.

    In preparing its employees, CPI has prepared organizational capabilities, held various communication forums and debriefing programs. The provisioning program includes technical preparation for transitions, positive mental development in facing change to financial management.

    According to him, the Rokan Block's solid performance so far cannot be separated from the human resource factor behind it, namely employees with built-in expertise, culture, and work ethic.

"We are optimistic that they will be able to maintain the performance of the Rokan Block and can contribute significantly to new companies," said Albert.

    Reforminer Institute founder Pri Agung Rakhmanto asked that all preparations for the transition period of the Rokan Block must be matured so that later it does not interfere with production operations.

    At least, three crucial points need to be considered during the transition period for managing the Rokan Block. First, related to legal issues that must be resolved.

"Of course everything related to the legal basis must be completed because this is the basis for everything. In this regard, I think the process is relatively smooth, ”he told Bisnis.

    Second, things related to operational activities must be ensured that they continue to run well. He explained that production operations must continue and continue without any vacancies.

    Third, related to management. During the transition period, it is necessary to ensure that the new management can ensure that operations can continue to run smoothly and can manage properly in maintaining the level of investment, reserves, and ultimately production.

    According to him, finding partners by PHR, a subsidiary of PT Pertamina to work on the block, is a management problem.

"Later the new management will and need to assess all of it," he said.

NEED TO PARTNER

    Executive Director of the National Oil and Gas Companies Association (Aspermigas) Moshe Rizal explained that the most crucial thing in managing the Rokan Block is how Pertamina gets a strong partner with strong funding and operational capabilities, as well as strong technology.

    With great responsibility to oil and gas fields throughout Indonesia, he added, Pertamina's capacity is limited. This limitation can be seen in terms of funds and operational capabilities. To maximize production, he suggested that Pertamina should not work on the Rokan Block itself.

    He argues that there needs to be aware of its capacity and put aside political egos in the national interest so that the block is not in the same boat as the Mahakam Block, which has experienced a decline in production after being transferred to Pertamina.

"Must be willing to cooperate in terms of operations, at least joint operatorship, and perhaps also offer most of the PI," he explained.

Basuki Tjahaja Purnama AKA Ahok

    Previously, Pertamina President Commissioner Basuki Tjahaja Purnama was reviewing several oil and gas fields owned by the company to be used as a reference in managing the Rokan Block.

    The man who is familiarly called Ahok revealed that his party did not want to make the Rokan Block's fate when it was transferred to management, not to experience a decline in production as happened in the Mahakam Block.

The Cepu Block Exxonmobil

    Previously, Ahok visited Cepu Block, East Java to compare oil and gas blocks managed in collaboration with strategic partners with oil and gas blocks that are managed independently.

"Why can Banyu Urip become the pride of Indonesia's oil field with low production costs? Is it because Pertamina is only 45% and Exxon as a partner has excellent management and technology? They train and transfer technology very well for our nation, ”he said recently.

    Ahok said that Banyu Urip's field performance was considered very good. This is evidenced by the absence of oil spills of more than 1 barrel of oil and no lost time incidents since February 2016, and uptime of over 99% with production costs below the US $ 2 per barrel.

    According to Ahok, the results of the study from the Banyu Urip field will be implemented in the Rokan Block field and other oil and gas blocks managed by Pertamina. However, Ahok was reluctant to reveal the potential partners for the Rokan Block.

"We do not want the Wells blocks taken by Pertamina, such as the incident in Mahakam, not to be repeated in Rokan. Do it yourself, if not better, there must be a solution, "he said.

Bisnis Indonesia, page-4, Tuesday, May 18, 2021

Oil Theft in Block Rokan Overcame

 

    The mode of theft of oil by making connections in pipes or illegal tapping which is rife in the Rokan Block has been declared missing since last year.

    Head of the SKK Migas Operations Department, Representative of Sumbagut, Haryanto Syafri, said that the efforts of tight supervision through various means ranging from cooperation with the authorities and technology support have suppressed this illegal practice.

Blogger Agus Purnomo in SKK Migas

"Illegal tapping has ended since the second quarter of 2020. In our records, there is one incident in the third quarter of 2020 and the first quarter of 2021, but it is not illegal tapping, ”he said.

the Rokan Block

    Haryanto said there were still cases of theft of oil and gas facilities in the Rokan Block which were stolen by irresponsible persons. In 2019 there had been 981 events or the equivalent of 2.7 events per day.

    That number will decrease to 300 incidents in 2020. Meanwhile, the theft of these operating facilities has caused losses to the state because upstream oil and gas assets are state-owned, while the operation is carried out by PT Chevron Pacific Indonesia (CPI).

PT Chevron Pacific Indonesia (CPI)

"We hope that the theft of operational facilities can continue to be reduced," he said.

    Riau Police Chief, Agung Setya Imam Effendi, said that the practice of illegal tapping had not occurred at the CPI operational facility. However, theft of pipes and cables is still happening today.

    According to him, this must be resolved immediately so that it can create a good ecosystem in the Rokan Block to pursue the target of ready-to-sell oil production or lifting of 1 million barrels per day by 2030.

"We want to promote this cooperation between the National Police, TNI, SKK Migas, and PT Chevron Pacific Indonesia (CPI) so that we can ensure a conducive ecosystem to support the achievement of the target of 1 million barrels per day," he explained.

    Digital Innovation & Acceleration Advisor of Chevron Pacific Indonesia Ivan Susanto said that illegal activities in the Rokan Block often occur due to pipelines crossing residential areas.

“Crude oil theft often uses illegal tapping mode. The perpetrator perforated the active pipeline and installed a valve to drain the oil into the storage tank truck. With the use of drones, suspicious activity like this can be detected immediately, "he said.

    Meanwhile, the drone used is capable of roaming up to 20 km with an altitude of over 200 meters at a speed of about 60 km/hour. The drone can fly 1-2 hours to conduct surveillance of crude oil pipelines and transmit video directly to the control center.

"This equipment is done by the nation's children at CPI," he said.

Bisnis Indonesia, Page-4, Monday, May 10, 2021

Production Efforts from Old Wells Need Innovation

 

    PT Pertamina Hulu Indonesia said it needed innovation from oil and gas companies to increase the production of old wells.

    Pertamina Hulu Indonesia (PHI) President Director Chalid Said Salim said the company is currently trying to innovate in drilling activities, especially for development wells in regional 3 Kalimantan work areas.

"In 2021, PHI plans to drill five exploration wells and more than 80 development wells," he said.

    Meanwhile, PHI and its subsidiaries, namely PT Pertamina Hulu Mahakam, PT Pertamina Hulu Sanga Sanga, PT Pertamina Hulu East Kalimantan, PT Pertamina Hulu Attaka, and PT Pertamina Hulu West Ganal operate the tens of decades-old oil and gas production and operation facilities and fields. years so it requires technological innovation to maintain operating performance and the economy of assets.

    During the first quarter of 2021, PHI succeeded in exceeding the gas production target by the realization of 688.8 million standard cubic feet per day (MMscfd) of the target of the Company Budget Work Plan (RKAP) of 649.2 MMscfd or reaching 106.1%. Positive results were also obtained from oil production which reached 49 barrels per day (BPD) or 100.4% of the target.

    He continued that currently exploration well drilling is being carried out in the Mahakam working area for the TDE C-1X well, which is one of five exploration wells in PHI's definite commitment.

"The TDE C-1X well is the first area where we hope to find economical reserves to extend the production life of the Mahakam Work Area," he said.

Agus Amperianto

    Zone 8 General Manager Agus Amperianto explained the steps taken by PT Pertamina Hulu Mahakam (PHM) in utilizing technological innovations, including in drilling activities in the Mahakam Work Area.

The Mahakam Block

    PHM develops innovations in drilling techniques at the Mahakam CA without using a rig (rigless operation) through the use of the hydraulic workover unit (HWU) Drilling EHR-12 for drilling development wells.

    Agus added that the use of HWU by PHM has proven successful in supporting drilling activities at a lower cost while still prioritizing operational and production safety so that the company continues to encourage the use of this HWU in all regional work areas 3.

Blogger Agus Purnomo in SKK Migas

    Based on data from SKK Migas up to March 31, 2021, the realization of PHM gas production succeeded in exceeding the target with the realization of 535 MMscfd of the WP&B target of 435 MMscfd or reaching 122.9%. For oil production in the first quarter of 2021, PHM also succeeded in exceeding the target with the realization of 130.3% or the equivalent of 28,317 BPD.

    Upstream Subholding Corporate Secretary Whisnu Bahriansyah added that his party would support business units in the upstream oil and gas sector to contribute well to the achievement of national production.

"Upstream sub-holding will continue to support the positive performance of all upstream sub-holding subsidiaries and affiliates to support the country's energy sovereignty.

Bisnis Indonesia, Page-4, Tuesday, May 4, 2021.

First Quarter of 2021, Pertamina's Oil and Gas Production Exceeds the Target

 

    PT Pertamina Hulu Energi, the Sub holding Upstream of PT Pertamina (Persero), managed to record oil and gas production of up to 861 thousand barrels of oil equivalent per day / BOEPD in the first quarter of 2021. This realization is 2% higher than the company's target this year of 848 thousand BOEPD.

PT Pertamina EP

    Pertamina Hulu Energi President Director Budiman Parhusip said the contribution of oil and gas production came from the oil and gas block assets of the company and its affiliates, namely PT Pertamina EP, PT Pertamina EP Cepu (PEPC), PT Pertamina Hulu Indonesia, PT Pertamina Internasional EP, and several other companies. Asset companies spread at home and abroad.

PEPC

"This achievement is 147 thousand BOEPD from international oil and gas fields and 713 thousand BOEPD from domestic. We are grateful that for the first quarter of 2021, we were able to hold back the rate of decline in natural products in the majority of our fields, "he said.

    He explained that the actual gas production until the end of March was recorded at 2.405 million standard cubic feet per day / MMscfd or 4% above the company's first-quarter target of 2,318 MMScfd. Meanwhile, the realization of ready-to-sell gas production was 1,914 MMscfd. Inline, oil production from domestic oil and gas blocks is also very good.

"Until March 2021, domestic oil production will reach 298 thousand barrels per day (BPD), while the lifting is 290 thousand BPD. We continue to strive to be able to meet the targets that have been set, "added Budiman. Meanwhile, oil production from foreign assets was recorded at 97 thousand BPD and gas 291 MMScfd.

    The company has completed 1,647 kilometers (km) of 2D seismic, 33% higher than the target, and 198 square kilometers (km2) of 3D seismic. For exploration drilling, the company has completed one well and four other wells are still under construction. 

    Next, his party has completed the drilling of 46 development wells and worked on 66 other wells. His party also succeeded in reworking wells with as many as 124 activities or 13% more than the target and Well intervention 2,334 activities from the target of 2,301 activities.

    The existence of organizational changes in Pertamina, especially the formation of Upstream Subholding, has made Pertamina's upstream oil and gas activities more adaptive, agile, and efficient. Through this sub-holding, the synergy of all work areas through regionalization can increase operational excellence, accelerate the business development process, and make decision-making faster and agile due to reduced bureaucratic processes.

"Subholding Upstream Pertamina will continue to strive for optimal performance by trying to maintain production and lifting as well as continuing exploration, development, and innovation activities in all upstream companies to achieve the target this year," said Budiman.

Investor Daily, Page-8, Monday, May 3, 2021.

Uncertainty Still Looming

 

    High uncertainty still overshadows many upstream oil and gas projects which are targeted to operate this year. Apart from the prolonged impact of the pandemic, the fluctuating factor in world oil prices also makes the prospect always combined with risk.

Blogger Agus Purnomo in SKK Migas

    Based on the records of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), this year it is targeted that as many as 12 projects will be on stream with a total project value of US $ 1.62 billion.

    During the first quarter of 2021, there were 4 onstream projects with a total investment of US $ 111 million, increasing oil and gas production by 5,850 barrels of oil per day (BOPD) and 69.5 million standard cubic feet per day (MMscfd).

PHE ONWJ

    These projects include Gas Supply to RU-V Pertamina Hulu Mahakam, Belato Field by Seleraya Merangin Dua, and the KLD PHE ONWJ project, West Pangkah Saka Indonesia Pangkah.

    Executive Director of the National Oil and Gas Companies Association (Aspermigas) Moshe Rizal is optimistic that the cooperation contract contractors (KKKS) can be more active this year and increase their investment to catch up with last year's lagging performance.

    KKKS will focus on commercially faster projects so that the possibility of project delays this year can be minimized. In the latest development, the Merakes field in the East Sepinggan Working Area has been included in the onstream project after being delayed last year. National gas production is projected to increase by 368 MMscfd.

    It is admitted that realizing the project with a total investment of US $ 1.3 billion located in the Makassar Strait requires extra efforts due to the impact of the Covid-19 pandemic that has emerged since early 2020.

"This project was initially targeted to get onstream faster in the third quarter of 2020. It turns out that we have to shift slightly from the onstream plan that is in the POD approval to the first quarter of 2021, "said the head of SKK Migas Dwi Soetjipto.

Eni

    The important thing from the development of Merakes Field is the ability to synergize to improve the economy in the field. The proximity of the Merakes field discovery to the Jangkrik Lapanga Floating Production Unit (FPU) allows Eni to maximize synergies with the closest existing infrastructure to improve the economics of the Merakes Field. You do this by using a shared facility sharing scheme.

the Merakes field by ENI

    The Merakes Field development project is a deep-sea project where the depth is about 1,500 meters below sea level. This project has 5 production wells with a total production capacity of 450 MMSCFD or the equivalent of 85,000 barrels of oil equivalent per day (BOEPD).

    The production contribution from the Merakes field will increase the gas supply for East Kalimantan Province. Most of it will be prioritized for domestic consumers, including the fertilizer and electricity industry in East Kalimantan, and processed at the Bontang Refinery into LNG.

"We hope that with the certainty of gas supply for the industry, it will provide a bigger multiplier effect for the national economy," Dwi said.

    According to him, this year there are two national strategic projects targeted onstream, namely Jambaran Tiung Biru with a total investment of US $ 1.53 billion. If it operates commercially, it is projected to increase national gas production by 190 MMscfd.

    Tangguh Train-3 Papua is also scheduled to go on stream in the fourth quarter of 2021 with estimated additional gas production of 700 MMscfd and a concentrate of 3,000 barrels of condensate per day (BCPD).

    This US $ 8.9 billion projects was delayed from the previous target in the third quarter of 2021 to the fourth quarter of 2021. With the support of these projects, it is hoped that investment in the upstream oil and gas sector this year can be better than last year's US $ 10.21 billion from the 2020 target of US $ 12.1 billion.

"We hope that the investment in the upstream oil and gas sector at the end of the year can be greater than 2020. The amount of realization in the first quarter of 2021 is the US $ 2.4 billion, then for revenue in the first quarter of 2021 it will reach US $ 6.67 billion."

    Energy Watch Executive Director Mamit Setiawan said these expectations can be achieved as long as a number of important conditions are met. For example, related to the development of world oil prices, ease of carrying out work during a pandemic, full support from stakeholders, and solid cooperation at the regional level.

Bisnis Indonesia, Page-2, Friday, April 30, 2021.

Caring for Production Increase expectations

 

    The national fuel consumption which is projected to continue to increase makes the target of oil production of 1 million barrels per day and gas of 12,000 MMscfd in 2030 to be crucial at a time when Indonesia's efforts to build energy independence.

    Meanwhile, Indonesia is still the country with the largest oil imports in Southeast Asia due to the increasing domestic consumption of oil and gas without a significant increase in production.

    In the last 2 decades, the discovery of new oil reserves has been classified as minimal and Indonesia still relies on old wells that have not been explored. As a result, the government must import oil and gas to meet domestic energy needs, which often creates a trade balance deficit.

    In the next 10 years, petroleum consumption in Indonesia is projected at 2.27 million barrels per day (BPD) and natural gas consumption of around 11,728 MMscfd. This number has almost doubled compared to last year's consumption of around 1.66 million BPD of oil and 6,557 MMscfd of gas.

    On the other hand, the government's efforts to increase oil production to 1 million BPD and gas to 12,000 MMscfd are still fraught with a number of challenges. One of them is the Covid-19 pandemic which has had a negative impact on the upstream oil and gas industry.

Blogger Agus Purnomo in SKK Migas

    Secretary of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Taslim Z. Yunus said Indonesia's upstream oil and gas industry was influenced by global conditions caused by the level of control of the Covid-19 pandemic, fluctuations in world oil prices, and global investment trends.

    According to him, a tough challenge for the upstream oil and gas industry is the massive impact of Covid-19 which has caused oil prices to fall. As a result, production has also decreased, because oil and gas companies tend to reduce their investment.

    Last year, a number of international oil and gas companies that cut their investment were ExxonMobil by 30%, Shell by 20%, Chevron 20%, BP 25%, and Eni 255.

"What they need is to compete with other countries from the IRR, then the future trend is to look at environmentally friendly energy because from a social point of view it will be easier," he said.

    Meanwhile, SKK Migas has prepared four strategies to increase national oil and gas production as well as towards the 2030 production target, namely by optimizing production in existing fields, transforming resources into production, accelerating chemical Enhanced Oil Recovery (EOR), and exploring major discoveries.

    The long-term strategy will go through two stages to curb the rate of decline in production and increase production.

"The first and second strategies are to hold down the rate of production, while the increase in production will result from the EOR and exploration strategies," he explained.

    Head of SKK Migas Dwi Soetjipto added that investment needs will continue to increase for the next 10 years in order to pursue the oil production target of 1 million BPD and gas of 12,000 MMscfd. The investment is set at the US $ 187 billion.

    Dwi said that besides being attractive to investors, the target could provide a multiplier effect in the form of the gross revenue of US $ 371 billion with state revenues of US $ 131 billion in 2030. In addition, with money circulating from upstream oil and gas projects and open job opportunities, it will have an impact. both for the national and regional economies.

    Nevertheless, there are several challenges that need to be resolved domestically, namely the complexity of licensing, overlapping regulations between the central and regional governments, an unattractive fiscal regime, data unavailability, constraints in the area of ​​operation, land acquisition constraints, the longer oil and gas monetization process. and fear of making decisions, in this case, the criminalization of policies.

    Meanwhile, Ronald Gunawan, President Director of PT Medco E&P Indonesia, said 2020 was a difficult year for the upstream oil and gas industry. The Covid-19 pandemic has suppressed the performance of cooperation contract contractors (KKKS).

    According to him, the world oil price dropped drastically in the last year and followed by low natural gas prices made the upstream oil and gas sector languish. However, with efforts escorted by the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), operational activities can continue in the midst of a pandemic.

"SKK Migas support is very good. Hence, the operations of the KKKS are a little disrupted but not significant, ”he said.

Ronald said the vision to pursue the oil production target of 1 million BPD and 12,000 MMscfd of gas by 2030 has become a joint commitment of the government, SKK Migas, and KKKS.

    Meanwhile, since 2015 Medco has continued to increase its oil and gas production levels from the range of 56,000 barrels of oil equivalent per day (Mboepd) to reach the level of 100,000 Mboepd in 2020.

    According to him, the Covid-19 pandemic provides new lessons for running operations more efficiently. With a 20% reduction in capital expenditure or capital expenditure, Medco is still able to record an increase in production amid the pandemic.

INCENTIVE

    An energy observer who once served as Governor of Indonesia for OPEC, Widhyawan Prawiraatmadja, said that there needs to be an incentive provided by the government to be able to pursue the target of increasing oil and gas production.

    He said that it is possible to increase oil and gas production again in Indonesia. He gave an example that other countries, such as the United States and Mexico, had successfully implemented reliable technology, improved fiscal policy, and improved the business climate in an integrated manner.

"We have to do something drastic, the fiscal term must be the same as in other places. "The higher the spend, the higher the chances of getting the giant, this has been proven in Mexico," he said.

    Meanwhile, a Member of the National Energy Council, Satya Widya Yudha, said that in the context of energy security, the government needs to pay attention to affordability.

    Therefore, fossil energy will still be very dominant in the future, but still paying attention to environmental factors that will be supported by technology.

"So if our renewable energy is still less affordable, as a whole people will go to fossils, the world will go to fossils," he said.

Bisnis Indonesia, Page-4, Thursday, April 29, 2021.

The irony of an oil spill on Karawang

 

    An oil spill incident occurred again in the waters of Karawang, West Java. Not yet recovering from previous injuries, the north coast of Karawang was again tested. Mitigation and recovery of the impact of the incident are priorities.

    The black oil spills were scattered in a number of points on the north coast of Karawang, West Java, Saturday (24/4/2021) afternoon. The spill contaminated the beach sand to the rocks by the beach and the access road around it. There is a liquid form. Some of them are compacted. The smell is strong. The sea breeze made the smell easily spread everywhere.

    Pertamina Hulu Energi Offshore North West Java (PHE ONWJ) admitted that there was a pipe leak in the BZZA area, about 15 miles from the Karawang coast, Thursday (15/4/2021).

    During his visit to one of the affected points on Cemarajaya Beach, Cibuaya District, Karawang Regent Cellica Nurrachadiana said that the spill this time came from a leak in one of the pipes off the coast.

"We set a deadline so that this problem does not drag on, a maximum of three weeks for cleaning. If it is done, the environmental restoration will be carried out according to the study of the Ministry of Environment and Forestry," he said.

Blogger Agus Purnomo in SKK Migas

    SKK Migas Operations Deputy Julius Wiratno said the cause of the oil pipeline leak this time was internal corrosion of the pipe. The pipe is said to be old. So far, there have been no signs of external damage to the pipeline.

    As a result of this incident, the estimated loss of production due to oil leakage is around 6,000 barrels per day. Until now, the number of oil spills that have been collected is at least 10 barrels.

“Pipeline repair work with clamp installation is still ongoing. Currently, it has reached 80 percent, "he said.

    Manager Communications Relations & CID PHE ONWJ Hari Setyono said he had repaired the pipeline so that it was ensured that no more oil spilled out. The handling team also deployed several vessels to clean oil in the sea area. Ocean and air monitoring continue to follow the Oil Spill Model (MOTUM) trajectory, including the PHE ONWJ production facility and other potential areas.

Repeat

    The oil spill incident was an irony because it had previously occurred in Karawang waters, July 12, 2019. At that time, the oil spill came from drilling the YYA -1 well in the PHE ONWJ area. The leak at YYA-1 was stopped in September 2019. Contaminated seawater disturbs marine life and affects the quality of water used by shrimp and fish farmers.

    Endi Muhtarudin (63), a farmer in Sungai Buntu Village, felt the pain. He lost billions of rupiah due to early harvest. After the incident, the shrimp ponds were harvested early in stages. The shrimp was supposed to be harvested at the end of August.

    Ideally, a pond covering an area of ​​2,500 square meters produces 7-8 tons of shrimp with a selling price of Rp 105,000 per kilogram for 30 fish per kg. However, yesterday's early harvest only produced 1-3 tons of shrimp with a selling price of IDR 38,000-IDR 50,000 per kg.

    Losses for an early harvest shrimp pond reached hundreds of millions of rupiah. If calculated by the number of existing ponds, the total loss reaches billions of rupiah.

    This series of events almost made Endi despair. Moreover, until now, he said he had not received compensation from PHE ONWJ. In fact, he has spent a lot of money to cover losses to restore the basic quality of the ponds which reaches billions of rupiah to cover losses to restore the basic quality of the ponds.

"I sprayed it three times and heaped up new sand at the bottom of the pond. The cost is not small, "said Endi.

    This oil spill made a number of residents worried about the restoration of nature which correlates with businesses on the north coast. It seems that the monetary compensation will never be worth the long-term loss to the surrounding ecosystem.

    Secretary of the Citarum River Region Community Forum (Forkadas + C), Yuda Febrian Silitonga, in September 2019, said that the oil spill in the YYA-1 well off the coast of Tempuran-Karawang as far as 7 nautical miles raised fears of environmental pollution on the coasts of Karawang and Bekasi West Java.

    Oil will undergo a series of changes, weathering, or decay of physical and chemical properties in the marine environment.

 "The impact of the waste shows a negative effect on the coastal environment and marine waters, especially if there is direct contact with aquatic organisms," he said.

    One that has the potential to be affected is the Ciparage and Sendulang reef clusters. Sendulang coral reef has six coral clusters and Ciparage coral reef has five coral clusters with a total area of ​​121.67 hectares.

    Environmental restoration is one of the priorities that must be carried out immediately. In mid-July 2019, four dolphin carcasses were found on the north coast of Karawang, West Java, after the YYA-1 offshore platform leak incident in the PHE ONWJ Block.

the PHE ONWJ Block.

    The first carcass was found near the Buntu River, Pedes District, Monday (15/7/2019). End of July found another dolphin carcass. On August 17, 2019, the third dolphin carcass was found in the mouth of the Cilebar River, North Pusakajaya Village, Cilebar District. Finally, the carcass was found on September 5, 2019, in the Pelangi Beach area, Pedes District.

Disturbed ecosystem

    According to a marine pollution researcher from the LIPI Oceanographic Research Center Muhammad Reza Cordova, the sea contaminated with oil spilled waste can affect fish life and the ecosystem in it. When exposed to a direct oil spill, fish can immediately move away from the oil spill. However, the oil mixed in the water column will indirectly expose the fish.

    This can disrupt fish growth. The size of the liver is swollen, the liver is swollen, the heart rate of respiration or respiration can change, and the work of the fins and the reproductive health of the fish can be disturbed.

    The position of oil is on the surface of the water, but due to its large quantity, it is exposed to currents and waves, it can mix with water. This mixed oil is present in several locations, starting from the surface, the water column, to the bottom of the water.

    The oil that has reached the bottom and accumulated in the sediments can make them more toxic. This is because the shape of the crude oil changes its molecular shape. Oil also has a negative impact on coral reefs, seagrass (plants that live in shallow seas), and mangroves.

"Oil covering the surface of individual corals, seagrass or mangroves can trigger stress, so that the ecosystem will be disturbed. If the marine ecosystem is disturbed, the fish will automatically leave or die, ”said Reza.

    Regarding ecosystem restoration, Reza suggested, the process of cleaning the sea must be clean of oil first, because the oil will block the diffusion of oxygen from the air to water or sediment affected by pollution. 

"It must be completely cleaned so that it does not settle, which can eventually accumulate in the biota," he said.

    Pertamina Subholding Upstream Corporate Secretary Whisnu Bahriansyah said that his party will commit to restoring the environment due to the oil spill. Currently, his office is still focused on cleaning up the oil spill. The cause of the leak was also investigated.

    Good mitigation is needed to reduce the impact that may occur. This incident cannot be repeated because it can have a long impact on the surrounding ecosystem.

Kompas, Page-11, Wednesday, April 28, 2021.

Pertamina Encouraged to Accelerate the Realization of Upstream Oil and Gas Investment

    The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) encourages Pertamina Group to accelerate the approval of upstream oil and gas investment. This acceleration is needed to meet the national oil lifting target this year, which was set at 705 thousand barrels per day (BPD).

Blogger Agus Purnomo in SKK Migas

    Head of SKK Migas Dwi Soetjipto said the realization of oil production by the end of March was recorded at 679.5 thousand BPD, so there is still a gap of 25.5 thousand BPD with a target of 705 thousand BPD. 

    This difference is due to the fact that the work programs of several cooperation contract contractors (KKKS) have not been realized, some of which are in the KKKS under the Pertamina Group. According to him, the difference in production from the Pertamina Group KKKS is around 10 thousand BPD.

"We are working hard to accelerate the work plan, especially in the second and third quarters. There is already a commitment from KKKS, including Pertamina, to accelerate implementation from the fourth quarter to the third quarter, so that it doesn't accumulate at the end of the year and the impact on production can be felt more quickly, "said Dwi.

    He said, the existence of organizational changes within the Pertamina Group through the formation of Upstream Subholding, had an impact on the implementation of the KKKS upstream work plan under the Pertamina Group. Primarily, related to the Final Investment Decision (FID) approval for the upstream work program.

    His party has discussed the delay in implementing this work plan with the management of PT Pertamina (Persero) as the Oil and Gas Holding and PT Pertamina Hulu Energi (PHE) as the Upstream Subholding. Pertamina has committed to be able to immediately provide investment approval and immediately resolve problems related to organizational changes.

"It has been said that starting this month there should be no more issues waiting for FID and this has been implemented. Pertamina has raised the investment limit that the subsidiary can make, ”said Dwi.

    This change will make the implementation of activities with a budget that is not too big to be smoother, including for drilling wells. PT Pertamina EP Communication Relations & CID Manager Hari Setyono said that his party remains committed to meeting national energy needs and supporting the achievement of targets set by the government. For this reason, Pertamina EP will increase the number of wells drilling this year to 131 wells.

"This amount represents the largest number of drilling in the history of Pertamina EP's operational activities," he said.

    Referring to SKK Migas data, there are three KKKS under the Pertamina Group whose oil production is still below the APBN target. In detail, as of last March, Pertamina EP oil production was recorded at 73,503 BPD or 86.5% of the target of 85 thousand BPD, PT Pertamina Hulu Energi OSES 24,030 thousand or 89% of the target of 27 thousand BPD, and PT Pertamina Hulu East Kalimantan 8,779 or 83. , 6% of the target of 10,500 BPD.

Pending Drilling

    According to Dwi, delays in the implementation of work programs also occurred in other KKKS, which in turn had an impact on the low realization of oil and gas lifting. In the first quarter of 2021, the realization of development wells still reached 76 wells, or 13% of the target of 616 wells. Then the realization of workover was only 143 wells or 23% of the target of 615 wells and well maintenance only 5,531 activities or 21% of the target of 26,431 activities.

    For exploration activities, 6 wells of the target of 48 wells were still drilled, 2D seismic survey of 1,349 kilometers (km) of the target of 4,569 km, 3D seismic of 263 square kilometers (km2) of the target of 1,549 km2, and G&G study of 62 activities from the target 116 activities.

"The development well is indeed at the beginning of the year for investment permits or FID and the procurement process has become late because it has only started in the current year in the future it will be repaired, "said Dwi.

    Another reason is that the production performance of several fields did not match forecasts, such as an increase in water content in the Banyu Urip and Sukowati Fields. Then there is the issue of facility integrity in the Offshore South East Sumatra (OSES) Block, X-Ray Field, and a leak in the North West Java Offshore Block.

    Finally, unplanned shutdowns at the Tangguh Papua Project, Suban Field, and the Jabung Block. However, he said that the acceleration of the implementation of the Pertamina Group and other KKKS work programs would help in pursuing the lifting target. 

    Moreover, the actual lifting has already exceeded 90%, namely oil lifting of 676.2 thousand barrels per day or 95.9% of the APBN target of 705 thousand BPD and gas of 5,539 million standard cubic feet per day / MMscfd or 98.3% of the target of 5,638 MMscfd.

"We will help with various kinds including FID approval, land acquisition, and environmental permits. We are working hard to be able to accelerate it, "said Dwi.

    The realization of oil and gas investment in the first quarter yesterday was not too high, namely US $ 2.4 billion or 19.4 percent of the target of US $ 12.38 billion.

"Efforts to attract investors will continue," he added.

    SKK Migas is working on a number of additional incentives for KKKS so that national oil and gas production can be higher.

Investor Daily, Page-10, Wednesday, April 28, 2021.

Existing Power Supply Continued 3 Years

    The existing power plant in the Rokan Block is certain to continue operating for the next 3 years, even though there is a transfer of operator management in the working area.

Blogger Agus Purnomo in SKK MIGAS

    Deputy Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Fatar Yani said electricity was one of the nine important elements in the process of transferring management of the Rokan Block from PT Chevron Pacific Indonesia to PT Pertamina Hulu Rokan (PHR).

PT Chevron Pacific Indonesia

"Of course it will continue even though there are other parties who enter. What is clear, 3 years is still going on to continue to sustain, "he said.

    The electricity and steam supply in the Rokan Block is currently produced by a steam gas power plant (PLTGU) operated by PT Mandau Cipta Tenaga Nusantara (MCTN) which is directly owned by Chevron Standart Ltd.

    Fatar said MCTN will carry out a business-to-business mechanism with new investors. He hopes that the process will not interfere with the transfer of management in the Rokan Block.

the Rokan Block

    Director of Commerce and Customer Management of PT PLN (Persero) Bob Sariel said that his party had signed an MoU for the supply of electricity and steam with Pertamina Hulu Rokan which will take effect in August 2021.

    Bob explained that in supplying electricity and steam for the Rokan Block, PLN divides it into two stages, namely the transition period and the permanent period. The transition period will last for 3 years starting from August 2021 to August 2024.

"During this transitional period, PLN will manage the existing power plants that currently have powered the Rokan work area," he explained. 

Bisnis Indonesia, Page-4, Wednesday, April 28, 2021