Why is Indonesia’s 120 years old oil and gas industry running on deficit?

Indonesia has been active in the oil and gas industry for over 120 years after the country’s first oil discovery in North Sumatra back in 1885. The number of domestic exploration and production working areas in the upstream industry increased from 107 units in 2002 to 308 units by the end of 2012, as a result of industry investments of about USD 21.3bn in 2012.

Indonesia has become a net importer of oil largely due to maturing fields and rising local demand. In the first quarter of 2013, Indonesia incurred a deficit of USD 3.36bn in oil and gas trading. The country exported USD 8.15bn worth of oil and gas, but imported USD 11.51bn during the same period.

Indonesia had 0.2% of the world’s proven oil reserves at approximately 3.7bn barrels by the end of 2012. Natural gas reserves of the country stood at 2.9 trillion cubic meters in 2012, representing 1.6% of the world’s total reserves. In 2012, Indonesia produced approximately 2.1% of the global natural gas.

Key Findings

• In 2012, approximately USD 16.11bn was invested in the upstream oil and gas industry. Investment in production and development accounted for 64.36% and 20.41%, respectively. 
• The number of domestic exploration and production working areas for the upstream industry increased from 107 in 2002 to 308 by the end of 2012. 
• Indonesia has identified floating storage and regasification unit (FSRU) as a      strategic asset to meet the country’s rising demand of gas.
• Indonesia aims to achieve 500 mmscfd of gas from coalbed methane by 2015 and 1,500 mmscfd      by 2025.

Source: SKKMigas

Much more in the EMD report: Indonesia Oil & Gas Industry>>

 

Indonesia scrambling to meet escalating oil and gas demand

In 2011, oil and natural gas accounted for 43.45% and 23.01% respectively of Indonesia’s primary energy consumption. Meanwhile, the number of domestic exploration and production working areas in the upstream industry increased from 107 units in 2002 to 245 units by the end of 2011, as a result of industry investments of about USD 13.7bn in 2011.

Oil and gas revenue accounted for 22.12% of the country’s total revenue in 2011. Indonesia has become a net importer of oil largely due to maturing fields and rising local demand. In the first eight months of 2012, the country exported USD 25.87bn worth of oil and gas and imported USD 27.51bn, creating a trade deficit of USD 1.64bn.

Indonesia had 0.2% of the world’s proven oil reserves at approximately 4bn barrels by the end of 2011. Natural gas reserves of the country stood at 3.0tcm in 2011, representing 1.4% of the world’s total reserves.

Key Findings

• In 2011, about USD 13.7bn was invested in the upstream oil and gas industry. Investment in production and development accounted for 66.42% and 22.34%, respectively. 
• Indonesia      has identified floating storage and regasification unit (FSRU) as a      strategic asset to meet the country’s rising demand of gas.
• Indonesia      aims to achieve 500 mmscfd of gas from coalbed methane by 2015 and 1,500      mmscfd by 2025.

Source: BPMigas

Learn more from the EMD Report: Indonesia Oil & Gas Industry >>