Oil and Gas Block - Photo by Pertamina

JAKARTA (TheInsiderStories) – Indonesia’ state-owned energy producer PT Pertamina signed oil and gas sales and purchase agreement with 11 contractors, as part of the producer planned to cut import. The oil and gas holding company aimed to cut import up to 200,000 barrels oil per day (BOPD) in 2019.

This is in accordance with Minister of Energy and Mineral Resources (MEMR) Regulation Number 42 Year 2018 which regulates the priority of oil use for domestic needs.

Recently, President Joko Widodo has instructed Pertamina to buy all domestic oil production at market prices in order to maintain current account deficit (CAD) and stabilise Rupiah against US dollar. Statistic Indonesia has announced Indonesia trade deficit widen to $2.05 billion in November.

Those contractors that have agreed namely PT Chevron Pacific Indonesia, PT SPR Langgak, PT Bumi Siak Pusako, PT Energi Mega Persada Tonga, and PT Energi Mega Persada Tbk (IDX: ENRG). Some others are Petronas Carigali Ketapang I Ltd., Husky CNOOC Madura Ltd., PetroChina International (Bermuda) Ltd., PetroChina International Jabung Ltd., RH Petrogas Limited, and SAKA Pangkah Indonesia Ltd.

Previously, Djoko Siswanto, Director General of Oil and Gas at the MEMR said, Chevron as the largest oil-producing contractor to manage the Rokan Block will sell 90,000 barrels of oil per day to Pertamina. Others, he added, still in discussion.

Currently, Indonesia produces around 800,000 BOPD, divided to the government’s share and oil & gas contractors’ share according to the production sharing contracts. Pertamina currently only instructed to buy the government’s share, while the contractors export its oil.

EMR minister Ignasius Jonan has said that oil and gas contractors currently export around 200,000 to 300,000 BOPD, while Pertamina imports around 300,000 to 400,000 BOPD.

According to the Upstream Oil and Gas Regulatory Special Task Force data, Exxon Mobil Cepu Limited is the biggest oil producer in Indonesia with a production of 209,922 barrel oil per day in the first semester of this year.

It followed by Chevron Pacific Indonesia (207,148 BOPD), Pertamina EP (70,031 BOPD), Pertamina Hulu Mahakam (46,376 BOPD), CNOOC (30,876 BOPD), Pertamina Hulu Energi ONWJ (30,489 BOPD), Petronas Carigali (Ketapang) Ltd (15,698 BOPD), Chevron Indonesia Company (14,410 BOPD), and PetroChina International Jabung Ltd (14,302 BOPD).

Jonan explained, total production of production sharing company (PSC) in Indonesia total of about 800 thousand barrels per day. While total oil consumption in the country around 1.8 million barrels per day.

In fact, said the minister, Pertamina only produce 400 thousand barrels per day. With these figures, rather than the PSC is bring out the oil production better to be sold to the oil and gas producer.

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