Page 9 - AsianOil Week 24 2021

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“This is needed in order to achieve the based on the regulation,” Pertamina Hulu Indo-
oil production target of 1mn barrels per day nesia (PHI) president director Chalid Said Salim
[bpd] of oil and 12bn cubic feet [339.84mn said.
cubic metres] per day of gas in 2030, in order Pertamina has signed a joint research co-op-
to jointly build a strategic partnership between eration and collaboration agreement with PHE
the government and business, as well as the and POSCO to look for new oil and gas potential
community,” Arifin said. in part of the Jambi Merang block, where PHE is
In addition to the two MoUs, Pertamina also already conducting a 2D seismic survey.
received approval from SKK Migas to proceed “PHE and POSCO jointly submitted a pro-
with its revised PoD for the struggling Mahakam posal for joint research activities in this open
block. It said the development plan now included area. The area proposed as the location of this
various fiscal incentives, including income tax joint research is 11,515 square km, where the
breaks that were provided for under Govern- presence of hydrocarbons has been identified
ment Regulation no. 27 of 2017. since the 1980s and 1990s,” Parhusip said.
“The production field of the Mahakam block, The companies will both review and rein-
under PHM’s management, is the first oil and gas terpret existing seismic data as well as study the
field in Indonesia to be awarded fiscal incentives results of this latest seismic survey.™

SKK Migas mulls Ande-Ande

Lumut’s development challenges

PROJECTS & INDONESIA’S upstream regulator SKK Migas
COMPANIES has revealed that the development of the Ande
Ande Lumut oilfield in the offshore Northwest
Natuna Block is more difficult than previously
anticipated.
The regulator said this week that while the
field was part of the country’s plans to boost
national oil production, its heavy oil reserves had of this year. Low oil prices coupled with the high
proved to be a challenging development. cost of development – including facility con-
“The Ande Ande Lumut field has heavy oil struction and the use of chemical injection –
and is not easy to produce. Heavy oil is a bit have prevented a final investment decision (FID)
difficult to process,” local news outlet Katadata from being reached so far.
quoted SKK Migas secretary Taslim Yunus as However, the regulator has said separately
saying on June 15. that it hopes to see a greater level of investment in
While Premier Oil discovered Ande Ande the country’s upstream thanks to a combination
Lumut in 2000, the company relinquished the of fiscal incentives for upstream projects as well
block in 2003 owing to the associated develop- as stronger higher oil prices.
ment challenges. The block is located close to the Commenting on this year’s oil and gas reve-
Malaysia-Indonesia maritime border. nue contribution targets, SKK Migas secretary
AWE, a wholly owned subsidiary of Japan’s Taslim Yunus that the government was “grate-
Mitsui, operates the field in partnership with ful” for the international oil prices of around $73
Australian independent Santos. SKK Migas said per barrel, which translated into an Indonesian
in 2019 that it expected AWE to submit a revised Crude Price (ICP) of around $68 per barrel.
field development plan (FDP) for Ande Ande “We hope that this high price can encourage
Lumut in order to boost reserves. [contractors] to increase their investment activ-
The project is estimated to contain 101mn ities, among others, by immediately realising
barrels of gross recoverable oil in the K-sand res- projects that were previously abandoned because
ervoir and another 36mn barrels of gross recov- they had an economic price of $50 or $60 per
erable oil in the G-sand reservoir. Drill stem tests barrel,” Yunus said on June 15.
(DSTs) have shown both reservoirs contain 10.7 Ande Ande Lumut’s current FDP envi-
degree API oil. sions building 25,000-40,000 barrels per day
The field has missed a series of first produc- of production capacity, though the field is only
tion targets, with the latest being the first quarter expected to reach a peak output of 25,000 bpd.™

Week 24 17•June•2021 www. NEWSBASE .com P9