Selasa, Juli 9, 2024

Ministry Urges Immediate Development of Idle Oil-and-Gas Working Areas in Effort to Boost National Production

The Minister of Energy and Mineral Resources ("Minister") has issued the Decree on Guidelines for the Return of Potential Working Areas That Are Not Utilized in Order to Optimize Oil and Gas Production, which urges oil and gas (Minyak dan Gas) cooperation contract contractors (Kontraktor Kontrak Kerja Sama – "KKKS") to promptly develop potential idle working areas
Ariana Soemanto, Director of Upstream Oil-and-Gas Business Development at the Directorate-General of Oil and Gas has issued a statement affirming that the criteria for potential idle working areas include production fields that have not been operational for two consecutive years, as well as fields with Plans of Development ("PoD") other than the first PoD that have not been executed for two consecutive years. In addition, working areas with discovered structures that have not been developed for three consecutive years will also be considered idle.
Mr. Soemanto added that it is essential to take action in relation to these potential idle working areas, which are currently being inventoried and readied for immediate optimization efforts. A total of four primary optimization measures can be undertaken: 1) KKKS can develop idle areas, with economic improvements potentially being proposed to the Ministry through the Special Task Force for Upstream Oil and Gas (Satuan Kerja Khusus Pelaksanaan Kegiatan Usaha Minyak dan Gas Bumi – "SKK Migas") or the Aceh Oil and Gas Management Agency (Badan Pengelola Migas Aceh – "BPMA"); 2) KKKS can collaborate with other entities in order to apply specific technologies; 3) KKKS can propose management transfers to other KKKS; and 4) KKKS can return idle areas to the Ministry in line with their post-operation obligations. These areas will then be offered as new working areas in accordance with the applicable Regulations.
The government is continuing to actively encourage increased oil-and-gas exploration and production. One initiative in this area is an effort to improve contract terms for oil-and-gas block auctions, including increasing contractor profit sharing from the previous level of 15% - 30% to as much as 50%. In addition, the government may also provide upstream oil-and-gas incentives in order to support contractor economics. _(ANT)

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The Minister of Energy and Mineral Resources ("Minister") has issued the Decree on Guidelines for the Return of Potential Working Areas That Are Not Utilized in Order to Optimize Oil and Gas Production, which urges oil and gas (Minyak dan Gas) cooperation contract contractors (Kontraktor Kontrak Kerja Sama – "KKKS") to promptly develop potential idle working areas
Ariana Soemanto, Director of Upstream Oil-and-Gas Business Development at the Directorate-General of Oil and Gas has issued a statement affirming that the criteria for potential idle working areas include production fields that have not been operational for two consecutive years, as well as fields with Plans of Development ("PoD") other than the first PoD that have not been executed for two consecutive years. In addition, working areas with discovered structures that have not been developed for three consecutive years will also be considered idle.
Mr. Soemanto added that it is essential to take action in relation to these potential idle working areas, which are currently being inventoried and readied for immediate optimization efforts. A total of four primary optimization measures can be undertaken: 1) KKKS can develop idle areas, with economic improvements potentially being proposed to the Ministry through the Special Task Force for Upstream Oil and Gas (Satuan Kerja Khusus Pelaksanaan Kegiatan Usaha Minyak dan Gas Bumi – "SKK Migas") or the Aceh Oil and Gas Management Agency (Badan Pengelola Migas Aceh – "BPMA"); 2) KKKS can collaborate with other entities in order to apply specific technologies; 3) KKKS can propose management transfers to other KKKS; and 4) KKKS can return idle areas to the Ministry in line with their post-operation obligations. These areas will then be offered as new working areas in accordance with the applicable Regulations.
The government is continuing to actively encourage increased oil-and-gas exploration and production. One initiative in this area is an effort to improve contract terms for oil-and-gas block auctions, including increasing contractor profit sharing from the previous level of 15% - 30% to as much as 50%. In addition, the government may also provide upstream oil-and-gas incentives in order to support contractor economics. _(ANT)

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