Page 6 - AsianOil Week 48

AsianOil SOUTHEAST ASIA AsianOil
Indonesia considers more flexible upstream licensing system
POLICY
INDONESIA may allow upstream developers to choose between the country’s current licensing model and the one it replaced in 2017, Energy Minister Arifin Tasrif said on December 2.
The government introduced the gross split system in 2017, which removed the cost recovery mechanism from production-sharing contracts (PSCs). The pre-2017 model allowed companies to recoup their exploration costs before splitting production with the government.
Tasrif said the government was reviewing whether to allow contractors to opt for “which- ever is more suitable”. Qualifying Tasrif ’s com- ments, however, the energy ministry’s acting director general for oil and gas, Djoko Siswanto, said companies would be given this choice as long as their proposed costs were “fair” and showed a commitment to increasing production.
Pertamina Hulu Energi (PHE) director Tau- fik Adityawarman said some developers still engaged in exploration might prefer the older model owing to the lack of operational revenue.
The government’s move to introduce greater flexibility into its upstream licensing comes as Jakarta looks to stem a decline in production. National crude output almost halved from a peak of 1.67mn bpd in 1991 to 808,000 bpd in 2018, according to BP’s Statistical Review of World Energy 2019. Gas production, mean- while, fell from a peak of 87bn cubic metres in 2010 to 73.2 bcm in 2018.
Indonesian President Joko Widodo over- hauled the management of PHE’s parent com- pany, state-owned Pertamina, last month with a particular emphasis on improving upstream performance.
Widodo appointed former Jakarta governor Basuki Tjahaja Purnama, who received early release in January from a two-year blasphemy sentence, as president commissioner. Purnama received instructions to focus on reducing oil imports. The former CEO of state-owned Tel- ekomunikasi Selular, Emma Sri Martini, was appointed as the major’s CFO.
Although regulator SKK Migas announced a rebound in upstream spending in the first half of this year, it was still off the pace of the govern- ment’s target for the entire year.
SKK Migas chairman Dwi Soetjipto said in July that the country’s exploration and pro- duction assets had attracted $5.21bn of invest- ment in the January-June period, up from $4.5bn in the same period of 2018. SKK Migas has set a target $14.79bn worth of investment this year.™
Petronas sets date for second FLNG unit launch, mulls third
PROJECTS & COMPANIES
MALAYSIA’S state-owned Petronas is on track to launch its second floating liquefied natural gas (FLNG) vessel towards the end of next year, a senior executive has revealed.
The CEO of subsidiary PFLNG, Abang Yusuf Abang Puteh, said PFLNG Dua was expected to start commercial operations in November 2020 after setting sail from a local shipyard in Febru- ary 2020. The vessel, which will process gas from the deepwater Rotan gas field, had its official naming ceremony at Samsung Heavy Industries’ (SHI) shipyard at South Korea’s Geoje Island on November 27.
“We will be able to start it up in July, followed by commercial operation in November 2020,” the executive told Bernama on December 2.
Abang Puteh said PFLNG Dua would pro- cess gas from Rotan, which lies in 1,300 metres of water and is located 140km offshore Sabah State’s capital of Kota Kinabalu, for at least 15-16 years. He said: “If there are smaller fields around Rotan that are economically viable, it makes more sense to tie it back to the floater rather than relocating it.”
PFLNG Dua has a production capacity of 1.5mn tonnes per year of LNG and is expected
P6
w w w . N E W S B A S E . c o m Week 48 04•December•2019