Here's How Bahlil Presses Energy Import Fees Of IDR 500 Trillion Per Year

Minister of Energy and Mineral Resources Bahlil Lahadalia. (Photo: ANTARA)

JAKARTA - Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia revealed that efforts were made to reduce energy import costs by IDR 500 trillion per year, including by optimizing existing oil wells.

Bahlil said, because the lifting or production of crude oil in Indonesia continues to decline, Indonesia must spend foreign exchange of IDR 500 trillion per year only to import crude from abroad.

"So, how do we lead to energy sovereignty? Emphasize lifting with three patterns," Bahlil said as quoted by ANTARA, Monday, October 14.

He explained that the first pattern that can be done to increase oil lifting, first the idle oil wells (idle) must be reactivated.

The Ministry of Energy and Mineral Resources noted that there are around 44,900 oil wells in Indonesia, with 16,600 of them in idle conditions. Of these, about 5,000 wells can be optimized to increase national oil production.

Then, the second step is that wells that are running or active must be intervened with technology to increase capacity.

Furthermore, the next third effort that must be carried out is how to accelerate exploration.

"Indeed, we have to do what is called exploration. Now this exploration is already large in the Eastern regions, and this cost is very high and it takes time," said Bahlil.

To support this, Bahlil admitted, his party will soon cut various regulations that hinder the acceleration process rather than exploration.

This was done to attract investors.

"Of the 320 permits, now there are only 140 permits, we will cut it again, we will shorten it at the right time, so what? Investors can enter If there is no offer that is more competitive than other countries, how can investors enter," he also said.

Bahlil said that the current government and Elected President Prabowo Subianto also encourage a shift in the use of vehicle fuel from fossil fuels to new and renewable energy.

This is implemented through the use of electric vehicles

"If we can do this, then we will partially move it to new and renewable energy by optimizing electric cars and electric motors, this is part of the energy sovereignty, if we can do this, God willing, it will be clear," he said again.

Previously, Bahlil highlighted that the cost of importing energy was quite large, reaching Rp500 trillion per year.

This is due to the declining performance of the oil and gas sector, which also has an impact on the rupiah exchange rate on the United States (US) dollar.

"Our relationship is down, we continue to score it, every year we spend our foreign exchange of IDR 500 trillion, that's why our US dollar exchange rate against the rupiah is a bit small, pushed back and forth. Imagine that one of the biggest sources of need is to buy energy," said Bahlil.

Bahlil revealed, in 1996 and 1997, Indonesia was able to produce 1,000,600 barrels of oil per day, which contributed significantly to state revenue, because it was able to export up to 1 million barrels.

However, after the reform, oil production continues to decline.

Currently, national oil production is only 600,000 barrels per day, while consumption reaches 1,000,600 barrels per day.

This causes Indonesia to import around 900,000u to 1 million barrels of oil per day.

Bahlil emphasized that the changes that occur from exports to imports of the same amount are serious problems that must be overcome.