Oil and gas exploration success stories spark promise for Indonesia

Oil and gas exploration success stories spark promise for Indonesia

The discovery of 2 trillion cubic feet of recoverable gas resources in the Kali Berau Deep Field in South Sumatera in early 2019 marked a new era of oil and gas exploration in Indonesia. Prior to it, it was almost two decades since the last significant discovery in Indonesia which was the Banyu Urip Field in Cepu Block by ExxonMobil Indonesia. The discovery was also among the ten largest finds worldwide in the period of 2018-2019. The discovery sparks real hope for Indonesia.

Following the Repsol success story, Pertamina has commenced the largest 2D seismic activity in Asia Pacific, which will reach 30,000 kilometers from offshore Bangka to Papua. The survey was a part of Pertamina Jambi Merang’s Komitmen Kerja Pasti (KKP). KKP allows the operator to acquire data outside of the block boundary as a part of the commitment. New data acquired in open areas is expected to entice companies to do further exploration.

Furthermore, SKK Migas has identified ten areas with giant discovery potential. These ten areas are South Sumatera, North Sumatera, Central Sumatera, Tarakan Offshore, North East Java-Makassar Strait, Kutai Offshore, Buton Offshore, Northern Papua, Bird Body Papua, and Warim Papua.

To encourage more exploration activities, the government also introduced a new regulation that allows open access to national oil and gas upstream data. Minister of Energy and Mineral Resources, Arifin Tasrif, promised to improve the relevant data so that it can give a clear overview of Indonesia’s oil and gas potential to the investors. Moreover, Indonesia still has 72 unexplored basins. “We need to have a more detailed overview of our oil and gas potential. It is also a way to improve our oil and gas lifting,” said Minister Arifin.

According to data from the Energy and Mineral Resources Ministry, Indonesia’s oil reserves were estimated at 3,78 billion barrels. The country’s oil production reduced from 829.000 barrels per day (bpd) in 2016 to 745,610 bpd last year.

Therefore, the Government is pushing the oil and gas companies to do more exploration activities. Exploration is the process to search for oil and gas. Exploration usually is initiated by a detail geological review of the prospective area, followed by data acquisition. The most common data acquisition in oil and gas exploration is seismic survey. The seismic data will give subsurface image of rock formations that can be used to determine the location and size of possible oil and gas reservoirs (prospects). If prospects are identified, the next step is exploration drilling to prove whether the prospects contain oil or gas. This exploration activity takes years to complete, around 6-10 years in Indonesia.

Unfortunately, exploration does not always end up with oil and gas reserves discoveries that can be economically developed, and this is one of the risks that are taken by the oil and gas companies in the upstream industry. (*)