News Feed

Indonesia May Rejoin OPEC If Oil Output Exceeds Consumption- Ibu Evita Legowo.

Posted on : 02 Feb, 2010

Ibu Evita Legowo, Director General of Oil & Gas at Indonesia’s Ministry of Energy & Mineral resources, said in an interview on Sunday with the Wall Street Journal, that Indonesia could rejoin the Organization of the Petroleum Exporting Countries if its oil production were to exceed consumption again.

 

Latest figures show the country has been producing an average of 960,000 barrels of crude a day for 2009, and Indonesia hopes to increase this to 965,000 barrels a day by 2010 according to Ibu Evita.

 

Indonesia withdrew from OPEC in January 2009 amid declining output from its aging fields. Indonesia produced a mere 978,000 barrels a day of crude oil a day in 2008, down from peaks of 1.6 million barrels a day in 1995.

 

Indonesia aims to boost oil output to 1.1 million barrels a day by 2015 with smaller discoveries coming on stream. Indonesia is also looking to reign domestic oil consumption through the use of biofuels, geothermal energy and other renewable energies.

 

In the mean time, an official at Indonesian Energy Watchdog BPMigas said Indonesia was unlikely to meet its production targets for 2010, citing technical hitches, aging fields and under-investment as primary reasons.

 

Amir Hamzah, head of public relations division at BPMigas, told Reuters in an interview, “The crude oil and condensate production may not reach 960,000 bpd this year. That is because of many problems with the oil wells.”

 

“Some wells have been shut down due to technical problems during this year, plus there was a natural decline from ageing wells, which caused production to fall," he added.

 

While several major players like Chevron, ConocoPhillips and Total operate in Indonesia,

Investments in the region are slow, due to an uncertain business climate and confusion over policies.

 

Indonesia has offered new exploration rights and has said it will offer new incentives to oil and gas investors, including more favourable tax treatment and production split, in order to encourage exploration.

 

The 3rd Indonesian Oil Gas and Power (3rd Indo OGP) conference, which meets in Jakarta on 14-15 April, will provide clarity on Policies and Strategies to Speed up Developments in indonesia’s oil sector, with updates from regulators, industry watchdogs and industry executives alike.

 

Those keen on attending 3rd Indo OGP can submit their registrations online. >>Click here to access the online registration form.<<