Indonesia will auction around 68 unexplored offshore oil and gas basins starting next year to attract new investment in these sector, said the minister in one seminar - Photo: Privacy

JAKARTA (TheInsiderStories) – Indonesia will auction around 68 unexplored offshore oil and gas basins starting next year to attract new investment in these sector, said the minister in one seminar. The country’ reserves recorded 3.77 billion barrels of crude oil and 77 trillion cubic feet of natural gas.

Minister of energy and mineral resources, Arifin Tasrif, explained the government has targets to represent 24 percent of its energy mix by 2050 and completing master plans for six refineries. He expect with this programs will increase the processing capacity of crude oil from 1 million barrels per day (bpd) to 1.9 million bpd.

He adds, Indonesia would also expand its gas pipeline infrastructure to meet the domestic demand for power plants and supply the electricity to remote islands in the region. In this year, Indonesian government offered 10 oil and gas working areas in this year, said the official on Wednesday (08/05). The projects include direct offers for five working areas and others in regular auctions.

According to acting director general at the energy and mineral resources (EMR) ministry, Ego Syahrial, the 10 oil and gas working areas are spread across Kalimantan, Java and Papua Island. In details, five direct offering are Merangin III (onshore), Sekayu (onshore), North Kangean (offshore), Cendrawasih VIII (offshore), Mamberamo (onshore and offshore) with potential 1,203.69 Million Barrels of Oil (MMBO) and 586.9 billion cubic feet (Bcf).

Through a regular auction with potential 2,232.75 MMBO and 4,420 Bcf are West Palmerah (onshore), Wangkas (offshore), Liman (Onshore), Bose (onshore and offshore), and Maratua working areas (onshore and offshore). To improve the upstream oil and gas investment climate, said Syahrial, the ministry has issued EMR Ministerial Decree Number 12 of 2020 concerning gross split Production Sharing Contracts (PSC).

For new working areas being auctioned, as well as those that will expire, the option is to be able to use the form of PSC with the cost recovery or gross split mechanism or other forms of cooperation contracts. As of July 2020, he revealed, the exploration status of 99 working areas, consisting of 73 conventional and 26 non-conventional working areas. 81 of the contract use cost recovery revenue sharing and 18 working areas using gross split revenue sharing contracts.

Syahrial also reported, the realization of investment in the oil and gas sector in the first semester of 2020 was still below the target as the impact of the pandemic, only reached US$5.6 billion or 39 percent of the targets of $14.5 billion. From the total amount of the realization, investment in upstream sector recorded $4.84 billion and investment in the downstream sector amounted to $712.26 million.

More detailed, in the processing activities worth of $299.17 million, transportation of $346.44 million, storage $21.67 million and trade of $44.98 million.

Written by Editorial Staff, Email: theinsiderstories@gmail.com