Report To Commission VII DPR, SKK Migas Boss Conveys A Number Of Implementation Constraints Upstream

Head of SKK Migas Dwi Soetjipto (Photo: Doc. Antara)

JAKARTA - Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Dwi Soetjipto explained a number of obstacles faced by SKK Migas and Cooperation Contract Contractors (KKKS) upstream of Indonesia's oil and gas.

Dwi said that previously in the 2023 State Budget, an oil lifting target of 660 thousand BOPD was set, but on the way there was a technical gap with the entry of several pending projects so that the KKKS set a target in the Work Program and Budget (WP&B) of 621 thousand BOPD.

"It turns out that we are facing an entry rate problem which decreases by 5400 barrels per day. The existence of a delay project causes a reduction of 6100 bopd, then there are several equipment that stop down time, either planned or unplaned, to be reduced by 7,400 bopd," said Dwi in a hearing with Commission VII DPR RI, Wednesday, March 13.

Dwi added, besides that there is a work problem of contribution that is below the target, drilling has not been achieved so that oil lifting is reduced by 4700.

Then there was a safety stand down for one month so that oil and gas lifting again decreased by 3000 BOPD.

"Then there are several places that are low demand because their production capabilities cannot be optimized and at the same time even though it is gas, but there is an accompanying condensate. But there are efforts made with various optimizations so as to lift and add 12,800 bopd," explained Dwi.

Then for gas, the APBN target is set at 6160 MMSCFD, but in WP&B it is set at 5569 MMSCFD taking into account technical aspects and several pending projects.

"But there is still an additional production of 364 mmscaf so that it becomes 5376 MMSCAF.," continued Dwi.

Regarding the issue of safety standing down, Dwi said this happened throughout Pertamina for 4 months which resulted in delays in drilling activities and only restarted in April 2023.

Another issue faced by the KKKS is land procurement, licensing, and finance. The obstacles to land acquisition in the Area of Approval for the Use of Forest Areas (PPKH) are, for example, at Pertamina Hulu Rokan.

Furthermore, there are problems with the availability of rigs. Dwi said, many rigs that are on hired are in a cold stack condition, especially on ore rigs. In addition, the internal process at the KKKS Gross Split also causes the procurement process to be hampered.

"This had happened so that we slowly tried to invite potential rigs from abroad to be used in Indonesia temporarily until there was domestic production that could replace it," concluded Dwi.