Pertamina sees production boost from overseas blocks

Jul 20, 2016 12:00 AM

Oil and gas giant Pertamina has reported increased year-on-year (yoy) production during the first half of the year, despite the sluggish trend of global energy prices over the past couple of years.

Data from the state-owned company showed that oil and gas production increased 12.5 percent yoy to 640,000 barrels of oil equivalents per day (boepd) from January to June. Within the total production, Pertamina increased oil production by 11.3 percent to 305,000 barrels of oil per day (bopd) and gas production by 15.8 percent to 1.94 billion standard cubic feet per day (bscfd).

Pertamina’s production made up more than half of total national output in the first semester. Pertamina spokesperson Wianda Pusponegoro said the production increase had been greatly boosted by the production of its oil and gas fields overseas.

“In a time when many oil and gas companies have been slowing operations, we increased production of both oil and gas. Production from our overseas blocks has helped immensely,” she told reporters at a media briefing on Tuesday.

Oil prices have risen slightly since they hit a new low in the beginning of the year. West Texas Intermediate (WTI) traded crude at US$45.17 per barrel on Tuesday afternoon, while fellow benchmark set prices at $46.87 per barrel on the same day.

Pertamina data said 85,000 bopd and 200 million standard cubic feet per day (mmscfd) of gas were produced at their fields in Algeria, Malaysia and Iraq during the first semester. The field in Iraq, meanwhile, produced the most at 44,000 bopd, while the Algerian fields contributed to 111 mmscfd. During the same period last year, Pertamina’s overseas fields only produced 79,000 bopd and 196 mmscfd, adding up to 109,000 boepd.

Wianda said the company hoped to increase its production in the second half of the year, following a memorandum of understanding (MoU) signing between Pertamina and the National Iranian Oil Co. (NIOC) — operated by the Iranian government — at the end of the month. Once the companies finalize the deal, Pertamina will be able to import crude from two to four undisclosed sites in Iran for processing at the former’s refineries, such as the one in Cilacap, Central Java.

“Including in Iran, we hope to bring no less than 30,000 bopd from all of our future overseas blocks. We cannot bring home less than that,” Wianda said.

A recent report by the International Energy Agency said Iran’s oil production rose to 3.56 million bopd after international sanctions against the country were lifted in January, in exchange for the disabling of much of its nuclear infrastructure.

Following a deal with Russia’s Rosneft Oil Company earlier this year to jointly develop the Tuban refinery, Pertamina also announced it was considering investing in Rosneft’s upstream industry as it could potentially obtain an additional 35,000 bopd in crude oil supplies.

Pertamina has set an ambitious task to continue to increase its oil and gas production by 8 percent every year to reach a production rate of 2.05 million boepd by 2030. To do so, the company hopes to increase the number of mergers and acquisitions throughout the years, aiming to make up 1.082 million boepd by 2030.

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