Pertamina CEO Urges Government to Pay Attention to Slowing Upstream Investment

JAKARTA - PT Pertamina (Persero) President Director Simon Aloysius Mantiri has signaled a global downward trend in investment in the upstream oil and gas sector.

Therefore, he requested government support to ensure the upstream oil and gas industry remains attractive to investors.

"From a business perspective, the global downward trend is putting pressure on falling oil prices, squeezing margins and profitability," Simon said, as quoted on Tuesday, November 18.

In fact, Simon continued, investment in upstream oil and gas is key to increasing domestic oil production to achieve President Prabowo Subianto's goal of energy security.

This is especially true given the current gap between energy production and consumption, with consumption significantly exceeding production, which continues to decline.

"Oil and gas players, especially in Indonesia, are currently working hard to slow the natural decline. Of course, with consumption growing faster than our production, we ultimately cover the gap with imports," he explained.

To increase upstream oil and gas investment, Simon requested strong regulatory support to attract investors to Indonesia.

He made this statement regarding the revision of Law Number 22 of 2001 concerning Oil and Gas.

"Without strong regulatory support, investment attractiveness will continue to weaken, and energy security will certainly be threatened," said Simon.

According to him, Pertamina has several aspirations as a business player in the upstream oil and gas sector, one of which concerns upstream oil and gas institutions.

Second, Simon also requested that the government consider the formulation of the National Oil and Gas General Plan (RUMGN) and the Oil and Gas Development General Plan (RUPMG) to be regulated in the Oil and Gas Bill.

"Unlike our colleagues in the electricity sector, who already have the RUPTL (Land Use Plan), we also want to encourage accommodations for planning in the form of the RUMGN and RUPMG as a legal umbrella for investment, anchored to the national energy policy targets and the national energy general plan," Simon explained.

Furthermore, Simon also requested fiscal certainty and levying regulations that align with the economics of the working areas, particularly for deepwater, enhanced oil recovery (EOR), unconventional, mature fields, and decarbonization initiatives.

"No less important is the establishment of a petroleum fund managed by the Oil and Gas Special Business Entity (BUK) for oil and gas interests, including exploration, infrastructure, decarbonization, and others," Simon emphasized.