Cabotage rule disrupts oil, gas production

Director General for Oil and Gas Evita Legowo said the enforcement of the cabotage rule in May would disrupt national oil and gas production.

"The national production target at oil and gas off-shore fields will start to decline by 156,020 bpod of oil and 2,549 mmscfd of natural gas, totaling 595,000 bopd on May 7,? she told in her written statement during a hearing with the House of Representatives? Commission V on energy on Wednesday.

Evita said if no amendment was made to Law No. 17/2008 on shipping, activities to discover and increase oil and gas reserves would be hampered due to a delay in the implementation of seismic survey commitment worth US$188 million.

?The drilling works on exploration wells and development of oil and gas worth $2.8 billion will be postponed,? she said.

The delay of development of off-shore oil and gas fields this year will take place in East Kalimantan, Makassar Strait, southeastern part of Sumatra, Block A and Block B of Natuna, Pangkah, Kangean, West Madura, northern off-shore of West Java, Sampang and Mahakam.

Evita said the law did not accommodate certain types of ships that support oil and gas industry which cannot be found or are rare in Indonesia. The vessels include those for seismic, geophysics and geotechnical surveys, vessels for off-shore drilling, jack-up rig, semi submersible rig, deepwater drilling and tender assist rig, ships for off-shore construction activities such as main working barge, derrick/crane/ pipe/cable/subsea umbilical riser flexible (SURF), laying barge vessel and diving support vessel, ships to support off-shore operations such as anchor handling tug supply ( AHTS) deep water below 6,000 BHP, platform supply vessel and fast metal crew boat.

"Without certain exception for those kinds of ships, implementation of our main jobs and functions related to oil and gas resources management that supports national sustainable development will be hampered,? she said.(godang)