Upstream Oil and Gas Investment in Indonesia Has Bright Prospects
By: Astrid Widia)*
Upstream oil and gas investment in Indonesia has very bright prospects in the future. Apart from soaring world demand, Indonesia is a country rich in natural resources and supported by easy licensing, so it is hoped that business actors will not hesitate to invest in Indonesia.
There has been news that recently there has been an increase in demand coming directly from the European Union to Indonesia for liquefied natural gas or commonly known as liquefied natural gas (LNG). This cannot be abandoned at all from the various efforts that have recently been intensified by PT Pertamina (Persero) which continues to cooperate with a number of Cooperation Contract Contractors (KKKS) for larger oil and gas field development projects.
The current condition itself, the European Union is in dire need of gas supplies, even in large enough quantities. Moshe Rizal as Director of the Association of National Oil and Gas Companies (Aspermigas) stated that at least the Blue Continent needs around 25 to 40 trillion cubic feet (trillion cubic feet (TFC) of oil and gas supplies every day.
One of the things that influence why the European Union is in dire need of oil and gas supplies is because of the conflict between Russia and Ukraine, which even until now has not seen abating. This incident certainly has a direct impact on how the energy supply has been supplied by the country led by Vladimir Putin, resulting in a shortage or disruption of energy supply there.
Estimates of the long-term prospects owned by the upstream oil and gas sector in Indonesia itself will be very helpful if exploration activities can continue to be optimized. Therefore, from the other side, the Government itself also continues to provide regulations in the form of fiscal incentives and details that are very beneficial and make it easier for Cooperation Contract Contractors (KKKS) in all activities in order to increase oil and gas production.
Several steps that can technically support the exploration carried out according to Ira Miriawati as Srikandi BPST-1 Pertamina are to carry out massive drilling, the selection of basins should not be arbitrary and only the really good ones are used, as well as reliefs and also Geophysics also should not be left to do, plus continue to conduct GGR studies in order to obtain an efficient number of wells so that the project work is right on target.
Regarding this exploration, a former President Director of PT Pertamina Hulu Energi (PHE), Meidawati also gave a similar statement that exploration is very important because the main goal is to replace what has been produced so that energy management continues.
Furthermore, the bright prospect of investment in upstream oil and gas in Indonesia also continues to be supported by the existence of equipment in the form of sophisticated software. Lindy F Rorinsulu as one of Pertamina’s BPST-1 Heroes also said that currently Pertamina officers even have ladders that can be used to reach other low hanging fruit. Especially with so many potentials such as basins which are still not explored much, of course it would be very profitable if all of this could be done by prioritizing efficiency.
It is undeniable that the future of the oil and gas industry in the country now depends on how exploration activities are carried out and also what steps Pertamina will take. Fortunately for Pertamina itself, according to Nugrahani as the former Head of the Exploration Division of SKK Migas in one of the forums, that Pertamina continues to show commitment and definite work.
So far, the role of fossil energy, including oil and natural gas, can’t be replaced, how important it is, in fact it is one of the commodities that is so vital that the European Union continues to ask for help from Indonesia. For this reason, Mulyanto as a member of Commission VII DPR from the PKS faction stated that oil and gas production must continue to be encouraged because it will greatly help the country’s economic condition. Especially with the scarcity of energy supplies due to the Russia-Ukraine conflict, the price of oil and gas immediately skyrocketed so that it was actually very profitable for this nation.
With such a fantastic price increase, then indeed the world’s supply needs are also really running low, especially Indonesia itself is famous for having abundant fossil wealth, then of course investment from all parties including foreign parties can be predicted to continue to increase. Even the Minister of Finance (Menkeu) Sri Mulyani also had time to give appreciation regarding the oil and gas sector which is indeed able to provide additional PNBP and state income taxes very significantly.