House increases 2017 oil lifting target to 815,000 bpd

Just a day after upstream oil and gas authority SKK Migas warned the country?s oil production will decline next year to 780,000 bpd, from the estimated 820,000 bpd for this year due to among others to weak oil price, and aging fields, the House of Representatives Commission VII on energy at a meeting with the government on Tuesday raised the production target to 815,000 bpd.

The meeting, which deliberated some of the assumptions used in the proposed 2017 State Budget, concluded that the oil lifting assumption in the budget should be set at 815,000 bpd, higher than the 780,000 bpd target proposed earlier by the government, to allow the government to obtain greater revenue and reduce deficit, said lawmaker Gus Irawan Pasaribu, who chaired the meeting.

He said that other budget assumptions agreed during the meeting included Indonesia Crude Price target of US$45 per barrel, and gas lifting of 1.15 million boepd.

Irawan said that to help meet the higher oil lifting target, ExxonMobil which operates the Banyu Urip field in Cepu block has agreed to increase the field?s production rate from 165,000 bpd to 205,000 bpd.

SKK Migas, however, has yet to approve an earlier proposal by ExxonMobil to increase the Banyu Urip field production rate.

Interim Minister of Energy and Mineral Resources Luhut Panjaitan said that while his office has insisted on the 780,000 bpd assumption, as the higher target of 815,000 bpd has been the conclusion of the meeting, the government will work hard to try to meet the new target.

Editing by Reiner Simanjuntak