Oilfields development
Pertamina Told to Up Old, Idle Wells Productions
Upstream oil and gas regulator BPMigas has urged state-owned oil and gas firm PT Pertamina to revamp operations in old wells and idle fields rather than acquiring blocks currently owned by foreign companies to crank up production.
BPMigas secretary Rudi Rubiandini told reporters that there were around 5,000 old wells and 50 idle fields scattered across the country that might contribute an additional production of 200,000 barrels of oil per day (bpd) to the company.
“If Pertamina maximizes productions of those wells and fields, the national oil and gas production will increase.
“It is better than acquiring other companies’ blocks, which in the end do not add the country’s total production,” he said after a media briefing at his office on Friday.
Pertamina currently holds concessions of around 141,000 square-kilometer of oil and gas fields nationwide, the largest among production sharing contract (PSC) holders in Indonesia, Rudi said.
“However, Pertamina’s production is sadly not the largest,” he said.
“The utilization of enhanced oil recovery [EOR] technologies must be encouraged in old wells. Pertamina should also begin drilling the idle fields.”
Pertamina’s data showed in 2010 the firm produced 190,000 bpd, an increase of 2 percent from 186,000 in 2009. The company said earlier that it was confident that its oil production might top 208,000 barrels per day in 2011.
Responding to BPMigas’s request, Pertamina spokesman Mochamad Harun said his company had created two main strategies, organic and non-organic, to increase production.
The organic strategy was to boost the production of Pertamina’s existing oil and gas fields, while the non-organic strategy was to acquire other companies’ potential blocks.
“We want to acquire blocks currently owned by foreign PSC holders because we feel that we are also capable of taking care of the blocks when their contracts end,” he told The Jakarta Post over the phone. Harun claimed in other countries the governments encouraged national oil and gas companies to take over blocks from PSC holders when the contract ended to increase state income and develop the capability of national companies.
“We are confident that we are more than capable of taking over those blocks, particularly those located in areas with low risks,” Harun said. “Foreign investors which possess more advanced technologies have to be shifted to develop oil and gas blocks in areas with higher risks.”
Concerning old wells and idle fields, he said Pertamina, through its subdiary, PT Pertamina EP, had made some encouraging progresses such as at Bunyu and Sangasanga Tarakan fields in East Kalimantan. The Bunyu field increased its production from around 1,300 bpd to 6,800 bpd currently, while the Sangasanga Tarakan field’s production jumped from around 4,300 bpd to 6,300 bpd, Harun reported. In 2011, the government targeted to increase the national oil production from only 954,000 bpd in 2010 to 970,000 bpd.
However, Rudi was pessimistic that the target could be achieved due to weather anomaly that had disturbed operations of some PSC holders early this year. “Given the current trend, 950,000 bpd will be good enough for us,” he said.
BPMigas revealed that as of Feb. 22 the country’s oil production was only 905,000 bpd. The agency blamed unplanned shutdowns due to poor weather for the failure to reach the target of producing 970,000 bpd.
