Jakarta—Oil and gas lifting has exceeded the target set in 2016 State Budget Revision. The lifting targeted in the State Budget is 820 thousand barrels per day (BOPD) for oil, and 6,438 million standard cubic feet per day (MMSCFD) for gas. Meanwhile the lifting realization until last month reached 822 thousand BOPD for oil, and 6,643 MMSCFD for gas.
Head of Public Relations of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), Taslim Z. Yunus stated that one of significant contributors to the realization of the oil lifting target is Banyu Urip Field of Cepu Block. “Train B in Banyu Urip Project has started to produce at a full capacity of 185,000 BOPD since January 2016,” Taslim said on Friday (23/12). Other huge oil lifting contributors are Rokan, Pertamina EP, Mahakam, and Offshore Northwest Java (ONWJ) Blocks. Meanwhile, the five gas largest contributors are Mahakam, Berau, Pertamina EP, Corridor, and Senoro-Toili Blocks.
The production originates from 67 oil and gas blocks already in production stage. Most of the oil and gas fields in those blocks are categorized as mature fields with a production that continues to decline naturally. Contractors of Cooperation Contract (KKKS) working on these blocks run three major programs to reduce the rate of natural production decline, such as through drilling of development wells, work-over, and well service activities.
“From the beginning of the year to the end of November, the Contractors had been working on the drilling of 212 development wells, 1,055 work-over activities, and 33.925 well service activities,” Taslim continued.
Such activities contribute to reduce the rate of natural production decline in those mature fields. Meanwhile, in order to significantly raise the oil reserves, the only way is to explore and develop new sources of reserves. For exploration activities, from January to November 2016, the contractors conducted 10 seismic surveys, 11 non-seismic surveys, drilling of 36 exploration wells and re-entry of 3 exploration wells .
Of the said exploration well drilling activities, 20 drilling activities have been completed with 7 discovery wells, 7 dry wells, 5 wells with an indicated presence of hydrocarbons, and one well under evaluation process. The discovery wells are Bambu Besar (BBS)-4 (Pertamina EP); Tiung-3 (PetroChina International Jabung Ltd.); Meliwis-1 (Santos (Madura Offshore) Pty Ltd); Lumbian-2 (Seleraya Merangin 2); AAL-4X (Santos Northwest Natuna B.V); ABG-3 (Pertamina EP); and Sidayu-4 (Saka Indonesia Pangkah Ltd).
During this 2016, SKK Migas has also approved 28 field development plans both in the form of Plan of Development (POD) and Plan of Further Development (POFD). This development of new fields is expected to add the oil reserves by 142.45 million barrels and to add the gas reserves by 0.645 TSCF. This field development will require an investment of US $ 2.94 billion and is expected to generate revenues of US $ 6.85 billion.
Taslim mentioned that the upstream oil and gas activities, both in the exploration blocks and the production blocks, require a huge investment. By November, the investment incurred by the upstream oil and gas industry in 2016 reached US $ 10.43 billion, with the largest expenditures for production, amounting to US $ 7.81 billion.
To date the upstream oil and gas industry is still affected by low global oil prices. The average Indonesian Crude Price (ICP), throughout 2016 is in the range of US $ 39.15 per barrel. This figure is lower than the ICP price set in the revised state budget, which amounted to US $ 40 per barrel. With such price condition, the state revenues from upstream oil and gas activities until the end of the year are projected to amount to US $ 9.294 billion, or around Rp 125 trillion.