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Friday, March 6, 2020

Saudi Aramco in the Cilacap Refinery Project is Immediately Confirmed

PT Pertamina (Persero) hopes to immediately obtain certainty of the continued cooperation with Saudi Aramco related to the Cilacap Refinery Project this month. Certainty is needed after a change in the cooperation scheme of the two companies. 

Pertamina offers a new cooperation scheme for the Cilacap Refinery Project because the two companies do not immediately agree on the valuation of refinery assets. The refinery project will be carried out with the same scheme used in the Balikpapan Refinery Project, which is a lease.

the Balikpapan Refinery Project

Under this scheme, Pertamina will pay the rental fees for the joint venture with Saudi Aramco which is building a new refinery unit at the Cilacap Refinery Complex. While the refinery unit which is currently in operation remains the property of Pertamina. 

Saudi Aramco

Under the new scheme, the Pertamina-Saudi joint venture Aramco will build a new refinery unit. Pertamina Investment Planning and Risk Management Director Heru Setyawan revealed that his party was still waiting for Saudi Aramco's response to the new Cilacap Refinery cooperation scheme.

Pertamina Corporate Secretary Tajudin Noor had said, his party indeed hoped the agreement with Saudi Aramco could be signed as soon as possible. Although there are still a few things that are considered by potential partners, it cannot force them to set a deadline for an agreement. 

He explained, his party and Saudi Aramco discussed the benefits obtained by each party through this collaboration. In addition, it also waits if Saudi Aramco requires special treatment (privilege) from the government or company, such as business preconditions.

Although there is no agreement yet, Tajudin stressed that the Cilacap Refinery Project will not be stopped. If indeed it and Saudi Aramco did not reach an agreement, Pertamina would find another partner or work on the refinery project in Central Java.

"We open up opportunities for all partners," he said.

For information, the Cilacap Refinery Project has no significant progress because the two state-owned oil companies did not immediately reach an agreement on the valuation of existing refinery assets. 

Nicke Widyawati

   Until the last discussion, Pertamina President Director Nicke briefly revealed the difference between the valuations calculated by Pertamina and Saudi Aramco was still very large.

Investor Daily, Page-9, Wednesday, March 4, 2020

Thursday, March 5, 2020

Production Optimization is a Priority

Efforts to optimize the production of the Rokan Block, which is now entering the transition phase, is a priority for PT Chevron Pacific Indonesia. 

PT Chevron Pasific Indonesia

   PT Chevron Pasific Indonesia Corporate Communication Manager Sonitha Poernomo said discussions related to the transition of the legendary block contractor were ongoing so that the process could be more perfect. 

Sonitha Poernomo

   According to her, the steering committee consisting of the heads of SKK Migas, PT CPI, and Pertamina, which had been formed since the beginning of last year, regularly discussed the transition process. However, he was reluctant to disclose in more detail what the discussion was,

"The Rokan Block is a national strategic asset, therefore optimal sustainable production is a priority. PT CPI continues to work closely with SKK Migas and Pertamina to discuss various options to optimize production and create a safe, reliable and smooth transition, "he said.

Director of Investment Planning and Management of RiSiko PT Pertamina (Persero) Heru Setiawan previously said that the company could not invest in the Rokan Block because the transition process had not yet been completed.

SKK Migas

"Still being discussed at SKK Migas. Still awaiting how the agreement should be tidied up. The discussion is still with Chevron, only now what is the stage, the revenue sharing obligations must be tidied up, "said Sonitha Poernomo.

Heru added that the company's main focus for the Rokan Block is to maintain a decline rate level at a good point. That is why Pertamina continues to strive so that the transition process can begin immediately.

"Our goal is to maintain the level of production," he said.

Previously, Head of the Special Task Force for Upstream Oil and Gas Business Activities, Dwi Soetjipto, said that until now the solution for the Rokan Block transition process continues to be sought. Dwi revealed, if later Pertamina could not invest in the Rokan Block, another scenario would be that Chevron would invest in the block.

Bisnis Indonesia, Page-24, Wednesday, March 4, 2020

Pertamina Assesses Refinery Development in Sumatra

PT Pertamina (Persero) is currently studying the construction of a refinery in Sumatra. This step was taken by Pertamina as an option to relocate the construction site of the new Bontang Grass Roof Refinery / GRR, East Kalimantan.

the Bontang GRR

Pertamina's Investment Planning and Risk Management (IMR) Director Heru Setiawan explained that the company is currently reviewing several location options that will become new refinery construction sites, namely in Kuala Tanjung North Sumatra and Arun in Aceh.

"There are several locations in the same area, Bontang, Kuala Tanjung, and Arun," Heru said.

Kuala Tanjung, Heru admitted, became one of the strongest candidates for the new Pertamina refinery replacing the Bontang refinery. Based on preliminary studies, Kuala Tanjung region Already meet management requirements as a refinery construction site. This starts from the market availability of refined products to the availability of future land for development.

"Because there are factors close to the market, the land is there. There is an international market," Heru said.

Overseas Oil and Gas LLC [OOG]

In addition, the site observer also considered the change in refinery development partners. Pertamina is no longer partnering with Omani oil and gas company Overseas Oil and Gas LLC [OOG]. Even so, according to Heru, before determining the location of Pertamina, it must first decide on the cooperation that had been established with OOG. Now, Pertamina is in talks to end the cooperation.

"We propose for the cancellation, but there must be an agreement between the two parties because of the MoU and others," he said.

Republika, Page-14, Tuesday, March 3, 2020

Acquisition of the Southeast Jambi Block US $ 135,000

PT Pertamina (Persero) intends to increase cooperation with the Cooperation Contract Contractors (KKKS) to pursue a production target of 923,000 barrels of oil equivalent per day (boepd) this year. Pertamina hopes that the increase in production is in line with profit growth.

The latest asset included in Pertamina's portfolio is the South East Jambi Work Area (WK). PT PHE Southeast Jambi took over 27% of its participatory rights from the hands of Repsol Exploration South East Jambi B.V. The signing of the collaboration took place last Sunday.


PHE Southeast Jambi is a subsidiary of PT Pertamina Hulu Energi (PHE) or Pertamina's grandson.

"In the future, we hope to add reserve findings to develop and increase production," said Meidawati, Director of PT Pertamina Hulu Energi (PHE).

PT Pertamina Hulu Energi (PHE)

Looking at the 2018 annual report, PHE has proven oil reserves of 60.28 million barrels of oil (MBO), gas 341.25 billion standard cubic feet (BSCF) and oil and gas 119.16 million barrels of oil equivalent (mboe). Proven oil and oil and gas reserves are down compared to 2017. Only proven gas reserves are rising.

Block SK-305 Malaysia

PHE production relies on 51 Work Areas or blocks. A total of 49 blocks in the country. Then two other blocks abroad, namely Blocks 10 and 11.1 in Vietnam and Block SK-305 in Malaysia. 

     As a result, Southeast Jambi will add to the list of PHE working areas. So far the PHE management has not revealed detailed work plans for Southeast Jambi. But certainly, the acquisition of the block almost requires a special budget.

"Pertamina only replaced the signature bonus proportionally, that is, changing obligations and delivering a performance bond according to the size of the participation," Meidawati said.

The signature value of the Southeast Jambi Block bonus that is part of the PHE is the US $ 135,000. When referring to the Bank Indonesia middle rate (IDX) of Rp. 14,413, the value is around Rp. 1.95 billion. 

MOECO Southeast Jambi B.V.

    Just information, in 2018 the Consortium of Repsol Exploration South East Jambi B.V. and MOECO Southeast Jambi B.V. signed the Southeast Jambi Block Contract. 

The block's exact commitment consists of G and G, 2D seismic along 300 km with a total of US $ 4.65 million. While the signature bonus value is the US $ 500,000.

Kontan, Page-14, Tuesday, March 3, 2020

Pertamina Assesses Transfer of New Refinery Project Location

PT Pertamina (Persero) chose Kuala Tanjung in North Sumatra or Arun in Aceh as the location for the construction of a new Grass Root Refinery / GRR refinery replacing the Bontang refinery in East Kalimantan.

Pertamina's Investment Planning and Risk Management Director Heru Setiawan explained that one of the plans to relocate the project was due to consideration of the replacement of the new refinery development partner.

Overseas Oil and Gas (OOG) Llc

At present the partners who have signed a partnership in the Bontang GRR development project are an oil and gas company from Oman, Overseas Oil and Gas (OOG) Llc.

It is planned that Pertamina will move the GRR development project from Bontang in East Kalimantan to Kuala Tanjung or Arun in Aceh by cooperating with prospective new partners. 

     According to him, the two regions were chosen because they have aspects of land availability. In addition to the location of Kuala Tanjung and Arun, the company is considered closer to the international market.

Nicke Widyawati

Meanwhile, Pertamina's GRR project has so far not yet reached the construction stage. Previously, Pertamina President Director Nicke Widyawati acknowledged the option to replace partners in the construction of the Bontang refinery.

Nicke Widyawati

Nicke Widyawati said that his party was still looking for other partnership options considering that there were several things that prevented the previous option. Nicke said initial work was still being carried out while Pertamina re-elected partners.

Luhut Binsar Pandjaitan

Meanwhile Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan gave a signal that the development of the Bontang refinery project will involve investors from the United Arab Emirates.

"Partners in the East Kalimantan Bontang Refinery are very changeable. So later investors from Abu Dhabi can enter. "

Bisnis Indonesia, Page-23, Tuesday, March 3, 2020

Pertamina EP Drilled Nine Wells

PT Pertamina EP succeeded in completing the drilling of nine development wells and has even contributed to oil production in January 2020. Pertamina EP President Director Nanang Abdul Manaf said the nine wells came from four Pertamina EP assets.

PT Pertamina EP

"Each of the wells from asset-1, asset-2, and asset-3 as well as six wells from asset 5. Some of the wells drilled at the end of December 2019 were already producing in January, he explained.

The asset-1 well, the Bentayan-Ramba Well, contributes to oil production of 20 barrels per day (BPD). Then well-pavilion-Pendopo from asset-2 with a production of 50 BPD, and one oil and gas well from asset-3, namely Cemara Timur Cemara-Jatibarang with oil production 728 BPD and gas 5 million standard cubic feet per day (mmscfd). 

    Pertamina EP also completed drilling of six wells on asset 5. The six wells are Sangatta Well with 530 BPD production, Bunyu Well (B-203) with 457 BPD production and Bunyu Well (B-204) of 207 BPD.

"Two dives of the Tanjung Una-Sangasanga Well with a production of 308 BPD and the Louise Well of 577 BPD," said Nanang.

As of January 2020, Pertamina EP oil production reached 80,925 BPD and 965 mmscfd gas. KONTAN Note, Pertamina EP projects oil production of 85,000 bopd and 932 million mmscfd of gas this year.

Kontan, Page-14, Monday, March 2, 2020

Monday, March 2, 2020

Pertamina EP Cepu Wins International Award

PT Pertamina EP Cepu (PEPC), a subsidiary of PT Pertamina (Persero) received a prestigious international award from Project Financing International (PFI).

PT Pertamina EP Cepu (PEPC)

The award was given at the 2019 PFI Award some time ago in London, England. At the event, the award held by PFI named PEPC as the Asia Pacific Oil and Gas Deal of the Year.

Nicke Widyawati

The awarding ceremony was attended by Pertamina's President Director Nicke Widyawati and PEPC Managing Director, Jamsaton Nababan, "said PEPC Public Administration (PGA) Government Manager Edi Purnomo, Friday (2/28/2020).

According to him the award was obtained because of the success of PEPC in obtaining project financing for the Jambaran-Tiung Biru Unitization (JTB) Gas Development Project as a whole.

Project financing can be completed in less than six months from the issuance of Project Info Memo (PIM) and Request for Proposals (RFP) on 30 January 2019 with Financial Close on 13 June 2019. 

     Project Financing The JTB project undertaken by PEPC is also one of the projects the first to combine conventional funding with Islamic funding, with a total funding value of USD 1.8 billion, consisting of conventional USD 1.7 billion and USD 100 million sharia (Wakala).

The financial institutions which are incorporated in the JTB Project Financing consist of eight international banks and four domestic banks. International banks that participated were the Bank of China, CIMB, DBS, Intesa Sanpaolo, Maybank, MUFG, Milbank, and SMBC.

"While the domestic financial institutions involved are Bank Mandiri, Bank Negara Indonesia, BTPN and Bank Rakyat Indonesia. The JTB project has been designated by the Government of Indonesia as one of the National Strategic Projects with gas production that will be distributed through Pertagas's Gresik-Semarang Gas Pipeline for use in the country, "said the former lecturer at the Faculty of Communication at Dr. Soetomo University in Surabaya.

JTB will have a production capacity of 330 MMSCFD (raw gas) with gas sales of 192 MMSCFD. The scope of work of the JTB Gas Project includes Land Acquisition that has been completed, Early Civil Work (ECW) which has also been completed.

JGC Corporation

The scope of work currently underway is the drilling of six gas wells carried out by Pertamina Drilling Services Indonesia (PDSI) which is a subsidiary of Pertamina (Persero) and the construction of the Gas Processing Facilities (GPF) conducted by the Consortium of PT. Industrial Engineering, PT. JGC Indonesia and JGC Corporation.

"The JTB Gas Project is scheduled for completion in 2021," he added

Duta Masyarakat, Page-16, Saturday, Feb 29, 2020.

Pertamina Accelerates BPD 1 Million Oil Production Target by 2026

PT Pertamina (Persero) seeks to accelerate the increase in national oil production to 1 million Barrels Per Day (BPD) in 2026, from the initial plan of 2030.

This is to anticipate the increase in demand for crude oil after the completion of six refinery projects in 2026. 

Nicke Widyawati

    Pertamina's Director Nicke Widyawati said the Special Task Force for Upstream Oil and Gas Business Activities (SKK oil and gas) is targeting an increase in oil production to 1 million BPD. in 2030.

To achieve this target, his party will increase the number of drilling wells, conduct seismic activities to find new reserves, and applying enhanced oil recovery (EOR) technology. However, his party is now preparing an optimistic scenario of this plan, so that oil production of 1 million BPD can be realized in 2026.

"We are making an optimistic case with the EOR [1 million BPD production] in 2026. We hope," he said in a meeting with Commission VI Indonesian Parliament.

Nicke explained, the accelerated increase in oil production needs to be done because the company's oil needs will surge in 2026. This follows the targeted completion of six of the company's refinery projects that year which will boost refinery capacity from the current 1 million BPD to 2 million BPD.

"Why is it accelerated in 2026? Because the refineries we built are starting to produce, and that needs an additional supply of crude oil, " Nicke said.

Regarding EOR, according to her, Pertamina's Upstream Directorate is currently detailing technologies that can be used. It targets the EOR can be done quickly so that the results can be felt immediately. One of these EOR technologies will be used to increase oil production in the Rokan Block after the operatorship is switched to Pertamina.

"Mr. Dharmawan [Pertamina Upstream Director] and SKK oil and gas are refining the technology that we can use to accelerate additional production in upstream oil and gas," said Nicke.

Even now, Pertamina through Pertamina EP has also implemented EOR in Tanjung Field. The company has also signed a core understanding between Pertamina and Repsol for the management of the full scale, including the implementation of the Surfactant-polymer EOR.

In the Jirak and Rantau Fields, Pertamina is conducting a Surfactant chemical application study for EOR implementation in both fields. Furthermore, Pertamina is currently conducting studies in several fields, namely Jatibarang, Sukowati, and Ramba for EOR with CO2 flooding.

Pertamina also expanded the EOR activities to the oil and gas block managed by PT Pertamina Hulu Energi (PHE), namely in the Offshore North West Java Block, precisely in the Zulu Field and E-Main. In addition, in the Batang field which is operated by PHE Siak, an EOR Steam flooding pilot project will be conducted in the near future.

Acquisition of oil and gas blocks

In addition to EOR, Nicke said that the acquisition of oil and gas production blocks overseas is also the company's strategy to accelerate the achievement of 1 million BPD oil production in 2026.

"Because it is a faster and more effective way to increase production, the acquired blocks will produce," Nicke said.

Referring to Pertamina's data, the state-owned company will budget upstream oil and gas investment funds this year US $ 3.7 billion. The funds will be used to develop the upstream oil and gas business organically and inorganically. 

   For details, funds for developing the upstream oil and gas business organically or increasing oil and gas production from existing assets of US $ 3.57 billion. Meanwhile, for inorganic business development of US $ 150 million.

Pertamina Upstream Director Dharmawan H Samsu Sempat explained that the upstream oil and gas inorganic investment is the addition of oil and gas block assets. Unfortunately, he was reluctant to mention which oil and gas block the company was targeting.

Dharmawan only mentioned one of the regions that the company targeted to add assets, namely in Africa. Previously, Dharmawan H Samsu also briefly mentioned targeting oil and gas assets in the Middle East region.

The last time Pertamina took over oil and gas assets in another country was in 2017. At that time, the company acquired 64.46% shares of the French oil and gas company, Maurel and Promm. Through this acquisition, the company has oil and gas assets spread in Gabon, Nigeria, Tanzania, Namibia, Colombia, Canada, Myanmar, Italy, and other countries.

However, the main assets that have been producing are in Gabon, Nigeria, and Tanzania. In addition, in Algeria, the company has shares in the Menzel Lejmet North (MLN) Block, El Merk (EMK), and Ourhoud (OHD). Next, in Iraq, the company holds shares in West Qurna 1. Field. While in Malaysia, the company holds shares in Block K, Block Kikeh, SNR Block SK309, and Block SK311.

Investor Daily, Page-9, Thursday, Feb 27, 2020.

PHE Develops Southeast Jambi Block

PT Pertamina (Persero) continues to strive to develop oil and gas in Indonesia, one of which is by participating in the management of the Southeast Jambi Work Area.

Repsol Exploration South East Jambi

At this time Repsol Exploration South East Jambi BM is acting as the operator of the Southeast Jambi Region and in collaboration with the Repsol Exploration South East Jambi B.V, Pertamina is confident and ready to develop the Southeast Jambi Exploration Working Area.

Ifki Sukarya

VP Relations of PT Pertamina Hulu Energi (PHE) Ifki Sukarya explained, as stipulated in Government Regulation Number 35 of 2004 concerning Upstream Oil and Gas Business Activities, this Cooperation was carried out through the process of taking ownership of participating interests from South-east Jambi Work Area operators.

In this case, Pertamina assigned one of its subsidiaries, PT PHE Southeast Jambi, as one of the participating interest holders in the Jambi South-east Working Area.


"In order to realize this program, Pertamina continues to hold intensive discussions with Repsol Exploration South East Jambi B.V. at once communicating with the Government. Including the investment that will be carried out in the development of this Work Area, "added Ifki.

the signing of Participating Interest

Officially the signing of the collaboration was carried out by both parties, Repsol Exploration South East Jambi B.V. and PHE Southeast Jambi in the Central Jakarta Region.

The signing was carried out by the Director of PHE Southeast Jambi, Abdul Mutalib, with the General Manager of Repsol Exploration South East Jambi B.V. Greg Holman. One of Pertamina's corporate achievements in the early 2020, namely in cooperation with Repsol and MOECO in developing the Southeast Jambi Exploration Working Area.

This collaboration is the beginning of the partnership activities that will be carried out by the Upstream Directorate of PT Pertamina (Persero). Going forward, Pertamina will continue to look for opportunities to work with other Cooperation Contract Contractors (KKKS) to achieve Pertamina's production target of 923 thousand BOEPD in 2020.

Investor Daily, Page-9, Thursday, Feb 27, 2020.

Pertamina Acquires Southeast Jambi Oil and Gas Block

PT Pertamina (Persero) assigned a subsidiary of PT Pertamina Hulu Energi Southeast Jambi as one of the holders of 27% participating interest / PI in the Southeast Jambi Work Area.

With Pertamina's participation in the management of the Work Areas operated by Repsol Exploration South East Jambi B.V, it is expected to be able to support the company in achieving a production target of 923,000 boepd this year. 


    VP Relations of PT PHE Ifki Sukarya said the acquisition of 27% PI from Repsol as stipulated in Government Regulation No. 35/2004 concerning Upstream Oil and Gas Business Activities.

Ifki Sukarya

"Participating interest acquired by 27% of the Repsol portion was 67%," he said.

the Take over Participating interest

The takeover was marked by the signing of the collaboration by Southeast Jambi PHE Director Abdul Mutalib and Repsol Exploracion South East Jambi General Manager Greg Holman in Central Jakarta, Wednesday (26/2).

"This cooperation is the beginning of the partnership activities that will be carried out by Pertamina's Upstream Directorate. Going forward, Pertamina will continue to look for opportunities to work with other Cooperation Contract Contractors (KKKS) to achieve Pertamina's production target of 925,000 boepd by 2020, "Ifki explained.

The Southeast Jambi Block

The Southeast Jambi Block is one of seven oil and gas blocks auctioned under a direct bidding scheme in the first phase of 2018. Initially, Talisman West Bengara B.V teamed up with MOECO South Sumatra Co., Ltd to form a consortium to develop the block. 

    However, Repsol acquired Talisman so that the contract was signed by the Consortium of Repsol Exploration South East Jambi B.V and MOECO Southeast Jambi B.V Repsol on 17 July 2018.

Bisnis Indonesia, Page-23, Thursday, Feb 27, 2020