Oil, gas exploration targets won?t be achieved

Courtesy of SKKMigas

Upstream oil and gas authority SKK Migas said exploration targets set under this year?s work program and budget (WP&B) of oil and gas contractors are unlikely be realized.

SKK Migas Planning Deputy Jaffee Arizon Suardin said in a statement that as per September 22, of the 45 seismic survey activities planned under the revised 2017 WP&B, only 10 have been realized. For non-seismic survey, out of the planned 16 activities, only 11 have been realized.

Meanwhile, in terms of exploration drilling program, of the planned 138 wells, only 40 have been drilled.

?It is projected that until end of the year, there will be one additional seismic and non-seismic surveys, and drilling of four exploration wells,? he said during a dialogue on exploration performance on Friday, which was among others attended by Deputy Minister of Energy and Mineral Resources and oil and gas contractors.

SKK Migas said in the statement that exploration investment has been on a declining trend since 2014 primarily due to the weak oil price environment. Other affecting factors include unfavorable regulations, social issues, permitting problem, and financial condition of the contractors.

SKK Migas said exploration investment dropped in 2016 to 13 trillion from Rp 31.01 trillion in 2014. Currently, there are 270 oil and gas contractors in the country, of which 87 have reached exploitation phase, while 183 are still in the stage of exploration including 130 contractors of conventional oil and gas working areas, and 53 contractors of non-conventional working areas.

The government has been trying to improve the regulatory environment including providing incentives to help push exploration investment in the country, SKK Migas said.

Editing by Reiner Simanjuntak