03 policy regulation and opportunities on upstream sector

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03 policy regulation and opportunities on upstream sector

  1. 1. POLICY, REGULATION AND OPPORTUNITIES ON UPSTREAM SECTOR DIRECTORATE GENERAL OF OIL AND GAS MINISTRY OF ENERGY AND MINERAL RESOURCES REPUBLIC OF INDONESIA LONDON, 11 OCTOBER 2010
  2. 2. OUTLINE POLICY AND REGULATION CURRENT CONDITION BUSINESS OPPORTUNITIES CONCLUSION
  3. 3. POLICY AND REGULATION
  4. 4. TARGET OF ENERGY MIX (Presidential Regulation No. 5 of 2006) Primary Energy Mix 2006 Energy Mix 2025 Hydro Power 3.11%Geothermal Gas Oil Gas & CBM 1.32% 28.57% 20% 30% Biofuel 5% Geothermal NRE,17% 5% Biomass, Nuclear, Hydro Power, Solar, Oil Wind Power 5%51.66% Liquefaction Coal Coal 2% 15.34% Coal 33% Energy Elasticity = 1,8 Energy Elasticity < 1 NON FOSSIL ENERGY < 5% NON FOSSIL ENERGY/ New & Renewable Energy: 17 %
  5. 5. POLICY AND TARGETS OF INDONESIA OIL & GAS MANAGEMENT PETROLEUM POLICY TARGETS FOR 2025 Oil and Gas Supply Security  Maintain oil production level of Oil And Gas Utilization 1 Million BOPD Oil and Gas Pricing Policy Unconventional Oil and Gas Business  50% national operatorship Conservation Of Oil and Gas Production  Security of domestic Fuel Supply Increasing National Capacity In Oil and Industrial Feedstock And Gas Industry  91% local content (goods and FUEL POLICY services) Fuel Supply Security  99% skilled national workforce Fuel Categorization Pricing Policy  Achieving oil and gas safety, zero Fuel Diversification accidents, zero failure, and Fuel Standard and Quality achievement of zero flares, and Fuel Efficiency zero waste
  6. 6. REGULATION• Oil and Gas Law Number 22 Year 2001• Republic of Indonesia Government Regulation Number 35/2004 on Oil and Gas Upstream Business Activities as amended in Government Regulation Number 34/2005 and in Government Regulation Number 55/2009.
  7. 7. SOME REGULATIONS TO INCREASE OIL AND GAS EXPLORATION AND PRODUCTION1. MEMR DECREE No. 01 Year 2008 concerning Guidance on Oil Mining Business Activities for Old Well2. MEMR DECREE No. 03 Year 2008 concerning Guidance for Idle Field to be Developed3. MEMR DECREE No. 35 Year 2008 concerning Stipulation And Offering Of Oil And Gas Working Acreages4. MEMR DECREE No. 36 Year 2008 concerning Coalbed Methane Business Activities5. MEMR DECREE No. 06 Year 2010 concerning Guidance to Increase Oil & Natural Gas Production Policy
  8. 8. FISCAL INCENTIVESIn order to increase oil and gas production, The Government OfIndonesia (GOI) provided fiscal incentives by issuing threeMinisterial Decrees, which are:  Regulation of the Minister of Finance Number 177/PMK.011/2007 exemption of import duty on goods imported for the purpose of upstream oil and gas and geothermal business activities.  Regulation of the Minister of Finance Number 179/PMK.011/2007 tariff of import duty on imported drilling platforms or floating or sub- sea production facilities.  Regulation of the Minister of Finance Number 24/PMK.011/2010 value added tax on imported goods for upstream oil and gas and geothermal exploration activities, will be paid by the GOI in fiscal year 2010.
  9. 9. CURRENT CONDITION
  10. 10. INDONESIA’S OIL AND GAS RESERVE (STATUS: JANUARY 1, 2009) NAD 121.01 NATUNA 5.55 112.43 346.42 1.26 52.14NORTH SUMATRA 4,026.67 745.11 21.78 43.11 PAPUA 10.57 BORNEO MOLUCCAS 89.64 CENTRAL SUMATRA 23.71 902.42 51.95 SOUTH SUMATRA 17.74 2.68 15.22 WEST JAVA CELEBES 570.66 EAST JAVA 3.68 987.01 5.30 NOTE: GAS RESERVE (TSCF) OIL RESERVE (MM Barrel) PROVEN = 107.34 TSCF PROVEN = 4,303.10 MM Barrel 113.34 OIL RESERVE POTENTIAL = 52.29 TSCF POTENTIAL = 3,695.39 MM Barrel 1.27 GAS RESERVE TOTAL = 129.63 TSCF TOTAL = 7,998.49 MM Barrel
  11. 11. SELECTED LIST OF OIL AND GAS OPERATORS IN INDONESIA1. AMERADA HESS (INDONESIA-PANGKAH) LTD. 22. LUNDIN B.V2. APEX (BENGARA II) LTD. 23. MATRIX OIL ( ASAHAN ) PTY. LTD.3. B.G INTERNATIONAL LIMITED 24. MEDCO E&P INDONESIA4. BP INDONESIA 25. MOBIL LANGSA INC.5. CHEVRON PACIFIC INDONESIA 26. PERMINTRACER PETROLEUM LTD.6. CNOOC SOUTHEAST SUMATRA LTD. 27. PETROCHINA INTERNATIONAL7. CONOCOPHILLIPS 28. PETRONAS CARIGALI BERHAD LTD.8. COSTA INTERNATIONAL GROUP LTD. 29. PETROSELAT LTD.9. ENERGY EQUITY EPIC 30. PREMIER OIL NATUNA SEA, BV.10. ENI INDONESIA LTD. 31. SANTOS11. EXXONMOBIL OIL INDONESIA, INC. 32. SELE RAYA MERANGIN DUA12. GOLDEN SPIKE SOUTH SUMATRA LTD. 33. SHELL COMPANIES IN INDONESIA13. IMR - PETRONUSA BUMIBAKTI 34. SINOPEC INTERNATIONAL PETROLEUM14. INDO-PACIFIC RESOURCES (JAVA) LTD 35. STAR ENERGY (KAKAP) Ltd.15. INPEX CORPORATION 36. TALISMAN ASIA LTD.16. KALREZ PETROLEUM SERAM LTD. 37. TITAN RESOURCES (NATUNA) INDONESIA LTD17. KODEKO ENERGY CO LTD. 38. TOTAL E & P INDONESIE18. KONDUR PETROLEUM S.A. 39. VICO INDONESIA19. KOREA NATIONAL OIL CORPORATION (KNOC) 40. YPF JAMBI MERANG20. KUFPEC ( INDONESIA ) LTD. 41. ZODAN N.V.21. LASMO (MALAGOT) LTD. 42. ZUDAVI N.V.
  12. 12. CBM BASIN IN INDONESIA Total CBM Basin = 11 (Advance Resources International, Inc., 2003)
  13. 13. INDONESIA COALBED METHANE CONTRACT AREA status: June 2010 7 CBM Contracts signing in year 2008:  3 CBM Contracts signing in  5 CBM Contracts signing  5 CBM Contracts signing Mei 2009: in August 2009: in November 2009:1) Sekayu 5) Barito Banjar I 8) Ogan Komering 11) Tanjung Enim 16) Batangasin2) 13Bentian Besar 6) Barito Banjar II 9) Sangatta II 12) Ogan Komering II 17) Muara Enim3) Indragiri Hulu 7) Sangatta I 10) Tabulako 13) Pulang Pisau 18) Rengat4) Kutai 14) Barito Tapin 19) Sanga-Sanga 15) Kotabu 20) Barito
  14. 14. ROAD MAP OF CBM DEVELOPMENT PP: CBM – 1 Existing Oil & Gas Estimated CBM Rambutan acreage be prioritized Estimated CBM Production Production(GOI Sponsor ) to develop CBM 1.0 BcfD 2.0 BcfD PP CBM: – 2,3 Estimated CBM (private investment) Production ~ 1.8 BcfD 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Increasing number of CBM Development Contract Average production = 250 MSCFD/well Legend:Issuing of regulation to Government participationpromote CBM (for Oil & Project evaluation Gas and Coal Mining) Start of Commercial Era CBM production Start of CBM era (1st CBM Contract) PP : Pilot Project Estimated Production
  15. 15. OPPORTUNITIES
  16. 16. INDONESIA PETROLEUM FIRST BIDDING ROUND YEAR 2010
  17. 17. 1st Bidding Round ScheduleA. Direct Proposal (Closed) Access bid Document : 12 July 2010 – 24 August 2010 Clarification Form : 19 July 2010 – 20 August 2010 Submit Participating Document: 25 August 2010, 09.00 AM – 02.30 PMB. Regular Tender Access Document : 12 July 2010 – 5 November 2010 Clarification Form : 19 July 2010 – 1 November 2010 Submit Participating Document : 8 November 2010, 09.00 AM – 02.30 PM
  18. 18. Plan For CBM Working Acreage Bidding Round Year 2010
  19. 19. CONCLUSION
  20. 20. CONCLUSION1. In order to increase the declining production and the inclining national oil and gas demand, the Government of Indonesia issued the policy to push the oil and gas production and exploration.2. Based on the National Energy Policy, Indonesia has developed unconventional gas for national fuel demand.3. The friend countries are expected to actively participate in developing the Indonesia’s oil and gas.
  21. 21. THANK YOUwww.migas.esdm.go.id
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