Head Of SKK Migas: Upstream Oil And Gas Industry Needs Investments Of 179 Billion US Dollars

Head of SKK Migas, Dwi Soetjipto. (Mery Handayani/VOI)

BALI - The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) has a target of producing 1 million oil per day (BOPD) and gas production of 12 BSCFD by 2030. In order to achieve this target, strong efforts are needed to improve the oil and gas investment climate in Indonesia.

"To achieve this long-term target, we estimate that the Hulu Migas Industry requires an investment of 179 billion US dollars," said Head of SKK Migas, Dwi Soetjipto in his remarks at the IOG 2022 event, Bali, Wednesday, November 23.

Dwi said significant investment and active participation from domestic and international actors were needed to open up Indonesia's oil and gas potential.

Dwi further explained that the global oil and gas industry is in a very dynamic and challenging time because the current geopolitical and global economic situation causes disruptions in energy and food supply which further causes price increases. This condition has the potential to pose a threat of inflation and an economic and energy crisis.

Dwi also said another global trend that affects the oil and gas industry is the issue of energy transition. After the latest Kyoto Protocol, the Paris Agreement, and the G20, many countries, including Indonesia, are fully committed to reducing carbon emissions.

"In the Oil and Gas Industry, we see that several large oil companies have included carbon reductions and renewable energy investments in their portfolio strategies," he said.

According to Dwi, this condition creates two possibilities. First, oil and gas investment needs to be increased because it is necessary to include carbon reduction programs such as CCUS. On the other hand, competition to get investment in the oil and gas sector is increasing.

In the energy transition era, continued Dwi, LNG will play an important role due to the urgent need for natural gas supply in Europe and population and economic growth in Asian countries such as India and Indonesia.

"As a country that has extensive experience as an LNG producer, Indonesia has excellent opportunities to attract investment," he said.