Oil and Gas Needs Fiscal Incentives

jawapos.com – Indonesia’s ease of doing business rankings continues to increase. However, deregulation in the oil and gas investment sector did not experience a significant increase.

The Executive Director of the Reforminer Institute, Komaidi Notonegoro, said that Indonesia has 128 basins that have the potential to have hydrocarbon reserves. A total of 68 undrilled basins.

Based on data up to January 19, 2021, oil and gas field production reserves in Indonesia were recorded at 2.44 BBO (billion barrels of oil) and 43.6 TCF (trillion cubic feet) of natural gas.

“About 70 percent of the oil and gas production work area has experienced a natural decline in production. Meanwhile, production and maintenance costs for mature fields continue to increase in line with the decline in production capacity,” said Komaidi in Surabaya, Wednesday (9/11).

According to UNAIR alumnus, research conducted by the Inter-American Development Bank (IDB) in 2020 found that providing incentives for mature fields can increase the economic life of projects by an average of 30 years. Currently, about 52 percent or 40 weeks of oil and gas production are mature fields.

In addition, 36 CAs were aged 25-50 years and 4 CAs were over 50 years old. “Fiscal improvements and incentives are still needed to increase future oil and gas investment in achieving the target of 1 million BOPD of oil and 12 BCFD of gas by 2030,” said Komaidi.

“Our drilling target has increased compared to the previous year, so we hope to find new reserves and increase production,” he said.

Although the government has made many efforts to strengthen renewable energy, Indra ensures that Indonesia will not be able to abandon fossil energy until 2045. “The National Energy Council stated that the demand for gas will increase by 300 percent, oil will increase by 105 percent,” he said. .