The oil and gas sector is estimating still have a great opportunity to attract investors with a total investment value around US$117 billion until 2024 - Photo by Total

JAKARTA (TheInsiderStories) – The oil and gas sector is estimating still have a great opportunity to attract investors with a total investment value around US$117 billion until 2024, said the energy and mineral resources (EMR) ministry, today (02/19).

It said, the investment will obtained in stages. In this year the department targeting to bring new investment $15 billion, then $20 billion in 2021, $25 billion in 2022, $29 billion in 2023, and in 2024 worth of $28 billion.

The optimism comes after in 2019, the realization of investment in oil and gas sectors recorded $12.5 billion, which has increased in the last three years, especially in the upstream oil and gas sector. In details, the ministry explained, investment valued in upstream oil and gas recorded $11.49 billion, an increase compared to 2017′ achievements of $10.27 billion.

“We believe the investment target is quite realistic considering that several strategic oil and gas projects will run and there are still 128 basins filled with oil and gas that will be operational. Even some oil and gas working areas that have been exploited for a long time still have potential,” said the statement.

The same thing happened in the downstream sector, the opportunity for increased investment was driven by the expanding number of infrastructure development programs, such as the fuel oil program at 500 center points, 3.5 million city gas network connections, distribution of oil and gas converter kits for fishermen and farmers to the construction of gas transmission pipelines.

Last January, Indonesia’ upstream oil and gas regulator, SKKMigas, expects 12 oil and gas projects to come on stream in 2020. The new projects will give the country a total combined additional production capacity of 705 million standard cubic feet per day (mmscfd) of gas and around 3,000 barrels of oil per day (bpd).

Among the biggest projects is Eni East Sepinggan Ltd project in Merakes field, East Sepinggan block that is expected to come on stream in the fourth quarter of this year, said SKKMigas deputy, Julius Wiratno. The project is expected to have a production capacity of 400 mmscfd and gas reserves of two trillion cubic feet.

“Eni has been able to carry out the first steel cutting in only four months since the transition, which usually can only take place within one to two years,” he said, stressing the government’ commitment to supporting the upstream oil and gas capacity in order to maintain the national gas supply.

In April 2018, the government approved a proposal for the Merakes field development plan located in the Kutai Basin, off the coast of East Kalimantan. Eni plans to drill six underwater wells and build an underwater pipeline system that will be connected to the Jangkrik floating production unit in the Muara Bakau block, Wiratno stated.

Besides Eni’ project, the regulator expects four upstream oil and gas projects to come on stream in the first quarter of this year. The projects include Petronas Carigali Ketapang II Ltd’ Bukit Tua Phase 3 projects with an estimated production of 31.5 mmscfd.

Then Ophir Indonesia (Sampang) Pty. Ltd’s Grati Pressure Lovering projects with an estimated production of 30 mmscfd. Furthermore, PT Medco Energi Internasional Tbk’s (IDX: MEDC) Buntal-5 project in South Natuna Sea Block B with an estimated production of 45 mmscfd and Sembakung Power Plant by PT Pertamina.

In the second quarter of 2020, there were several projects planned to operate, namely the Randu Scissors project by PT PHE Randu Scissors with an estimated production of 3 mmscfd, Betung Compressors by Pertamina with an estimated production of 15 mmscfd, Malacca Strait Phase-1 by EMP Malacca Strait with an estimated production of 3,000 bpd, Meliwis by Ophir Indonesia (Madura Offshore) Pty. Ltd with an estimated production of 20 mmscfd.

Then in the third quarter of 2020, the regulator expects three projects to be in production, starting from PT Sele Raya Belida projects with an estimated production of 2.5 mmscfd, Pertamina’s LP-MP SKG-19 Compressor with an estimated production of 150 mmscfd and PT Pertamina Hulu Mahakam projects with an estimated production of 8 mmscfd.

by Linda Silaen, Email: linda.silaen@theinsiderstories.com