JAKARTA (Bernama-Xinhua): Facing year-on-year decline in oil lifting (post-sale production) and disruptions in global supply chains, Indonesia has been grappling with challenges in maintaining oil security.
Global supply chain disruptions caused by escalating international conflicts have led to significant volatility in global oil prices, impacting Indonesia's oil imports.
Over the years, Indonesia has transitioned from being a net oil exporter to a net oil importer due to aging wells and slow investment.
According to Indonesian Energy and Mineral Resources Minister Bahlil Lahadalia, Indonesia currently imports 1 million barrels of oil per day at an annual cost of 500 trillion rupiahs (around US$31.33 billion).
The country's oil lifting has decreased to around 600,000 barrels per day this year, down from 605,500 barrels per day last year. Additionally, oil purchases are heavily affected by price volatility in the global market, while the growing economy increases energy demand, including for oil.
To tackle these challenges, the Indonesian government has implemented several measures, including expanding refinery production capacity, building an oil reserve, intensifying exploration and reactivating aging or idle wells.
To ensure the smooth progress of the ongoing Refinery Development Master Plan (RDMP) project in Balikpapan, East Kalimantan province, Bahlil and Investment Minister Rosan Roeslani will plan a joint inspection.
The RDMP project, designated a national strategic initiative, aims to boost the refinery's processing capacity.
"This is Rosan's and my responsibility to check the project. If the RDMP project isn't completed, our oil imports will keep rising," he said on Wednesday.
Meanwhile, to mitigate reliance on volatile global oil prices, Bahlil noted that Indonesia plans to construct an oil reserve facility on an island near Singapore.
This facility will enable state-owned oil and gas firm PT Pertamina to purchase oil in bulk when prices are low and store it for use when prices rise. The reserve facility, designed to store various types of oil for 30 to 40 days, will surpass the country's current storage capacity of 21 days.
On the production front, the Indonesian government has intensified oil exploration and research over the past five years to boost domestic oil output.
According to Dwi Soetjipto, Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), these efforts have included drilling 130 exploration wells, conducting 11 regional studies, and completing over 600 geological and geophysical surveys.
"This shows the government's commitment to encouraging oil and gas discoveries to achieve short-term and long-term targets," he said.
The Ministry of Energy and Mineral Resources has identified 6,000 idle wells with reactivation potential. Deputy Energy and Mineral Resources Minister Yuliot Tanjung said that these efforts could increase oil lifting by up to 20,000 barrels per day. - Bernama-Xinhua
