Pertamina EP: New Incentives And Policies Of The Ministry Of Energy And Mineral Resources Will Increase Indonesia's Oil And Gas Production

Illustration. (Photo: Doc. Antara)

JAKARTA - PT Pertamina EP considers that new incentives and policies from the Ministry of Energy and Mineral Resources (ESDM) can increase oil and gas production.

"This incentive will mainly attract people, especially from contractors, to invest or increase the number of drillings to increase production," said VP of Regional SCM for Java PT Pertamina EP Bayu Kusuma Tri Aryanto in Surabaya, East Java, quoted from Antara, Tuesday, June 11.

In terms of strategic planning and operational teams, said Bayu, we must prepare how to support the acceleration of drilling. This support includes drilling readiness and readiness of other production facilities.

"What we need (supply chain management/SCM) to anticipate is what efforts to accelerate it," said Bayu.

Therefore, he hopes that through the Oil & Gas Supply Chain Management Summit 2024 (IOG SCM Summit 2024), there can be exchange of opinion and experience related to this acceleration.

Previously, the Director of Upstream Oil and Gas Business Development at the Directorate General of Oil and Gas at the Ministry of Energy and Mineral Resources, Ariana Soemanto, said that the upstream oil and gas sector would be more enthusiastic about the new incentives and policies issued.

First, the policy of improving the auction terms and oil and gas block contracts.

"This includes, among other things, the contractor split can reach 50 percent, the minimum bonus signature, the direct offer for oil and gas blocks without joint study, bank guarantees are cheaper, and the type of contract can be gross split or cost recovery," said Ariana.

The second policy is the privilege of exploration, including contractors being able to move the commitment of exploration activities to open areas outside the blocks being worked on.

"In addition, the extension of the exploration period is 10 years and there is an additional exploration time of more than 10 years. If this policy does not exist, then North Ganal's gas disclosure may not happen," explained Ariana Soemanto.

The third is the upstream oil and gas incentive policy through the Minister of Energy and Mineral Resources Decree Number 199 of 2021. This policy is to improve the economy of contractors in the middle of the road, through improvement of contractor splits, investment credit, accelerated depreciation calculations, and parameter improvements, which affect other economies.

Ariana added that the policies or incentives that are being finalized are the policy of sharing new gross splits through the regulation of the Minister of Energy and Mineral Resources.