• 4 minutes Some Good News on Climate Change Maybe
  • 7 minutes Cuba Charges U.S. Moving Special Forces, Preparing Venezuelan Intervention
  • 12 minutes Washington Eyes Crackdown On OPEC
  • 15 minutes Solar and Wind Will Not "Save" the Climate
  • 5 hours Amazon’s Exit Could Scare Off Tech Companies From New York
  • 9 hours Most Wanted Man In Latin America For AP Agency: Maduro Reveals Secret Meetings With US Envoy
  • 9 hours And for the final post in this series of 3: we’ll have a look at the Decline Rates in the Permian
  • 16 hours Former United Nations Scientist says the UN is lying about Global Warming and Sea-Level changes
  • 5 hours L.A. Mayor Ditches Gas Plant Plans
  • 13 hours Prospective Cause of Little Ice Age
  • 7 hours And the War on LNG is Now On
  • 1 day Maduro Asks OPEC For Help Against U.S. Sanctions
  • 1 day Qatar Petroleum, Exxon To Proceed With $10 bln Texas LNG Project
  • 1 day Russia to Turkey: You Can't Have Syrian Safe Zone Without Assad's Consent
  • 24 hours Solar Array Required to Match Global Oil Consumption
  • 11 hours *Happy Dance* ... U.S. Shale Oil Slowdown
The Achilles Heel For EV Makers

The Achilles Heel For EV Makers

Despite the overwhelming abundance of…

Pertamina Needs $100B To Increase Indonesia’s Oil Production

Pertamina refinery

Indonesia’s state-owned energy company Pertamina needs US$100 billion to boost oil production and meet the country’s oil demand, with 70 percent of this spending expected to come from external funds and partners, Pertamina’s vice president of corporate business strategic planning, Ernie D Ginting, said on Tuesday.

While Pertamina is looking to buy oil assets overseas—in Iraq and central Asia in particular—Indonesia’s own oil production that has been declining for decades, is declining faster than the company has been anticipating, Ginting said on the sidelines of the Asia Pacific Petroleum Conference (APPEC) in Singapore.

“Our fields are mature, there is no new, huge findings, so we are competing with natural decline,” the official said, noting that as domestic production drops, Indonesia’s oil demand continues to grow.

According to industry data, carried by Reuters, Indonesia is currently producing less than 800,000 bpd of oil, nearly halved from the peak of 1.5 million bpd in the mid-1990s.

Pertamina is looking to boost production, but it needs expertise and partnerships, because even if it acquires new blocks, it cannot develop them alone, Ginting said.

In a bid to cut its current account deficit, currently at 3 percent of GDP, Indonesia introduced earlier this month new legislation to prioritize local crude oil production over imported crude oil. The new regulation stipulates that oil and gas operators in Indonesia must first sell their production to Pertamina in Indonesia before considering exports of crude oil. 

Indonesia has been looking to cut crude oil imports and bolster domestic production, as oil prices have increased while the country’s finances have deteriorated.

Indonesia recorded a substantial decline in crude oil imports in June this year, down 48.8 percent from its May imports, as Pertamina focused its efforts on growing domestic production amid a falling local currency that made imports costlier, official statistical data quoted by S&P Global Platts showed.

Earlier this month, Indonesia’s currency, the rupiah, reached its lowest level to the U.S. dollar in 20 years amid the emerging markets currency rout.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News