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Indonesia expects US$36b in revenue from oil, gas sector
Publication Date : 28-12-2012
Indonesia, a former Southeast Asian member of the Organisation of the Petroleum Exporting Countries (OPEC), is expecting a total of US$36 billion from oil and gas revenue despite the decline in production from aging fields.
Energy and Mineral Resources Minister Jero Wacik, also the chief of the country’s interim upstream oil and gas regulatory task force SKMigas, said on Thursday that the estimated year-end state revenue was 8 per cent higher than the 2012 state budget target.
“The 2012 state revenue target from the sector was estimated to be $33.48 billion, which means the realisation of $36 billion in revenue is 108 per cent of the original aim,” he said.
The rise in the price of crude oil from January to December 24 boosted state revenue despite the decline in oil production. The Indonesian Crude Price (ICP) currently stands at $112.7 per barrel, or 6 per cent above the government’s assumption of $105 per barrel.
In March this year, the ICP surged to $128 per barrel before plummeting to $99.08 per barrel in June after being affected by the fluctuation of the world’s oil prices.
The projected state revenue from the sector comprises 58 per cent of the sector’s gross revenue of $63 billion, according to information from SKMigas.
Approximately $10.6 billion, or 16 per cent of the gross revenue, will go to oil and gas contractors while 26 per cent, or $15.5 billion, goes to the cost recovery scheme.
Under this system, the government compensates oil and gas producers as part of the production costs.
Indonesia’s crude oil output by the end of this year is expected to be only 860,000 barrels per day, which is 8 per cent lower than the government’s original target of 930,000 barrels per day and therefore, down by 4 per cent from last year.
The aging fields and unplanned shutdowns —such as US-based energy giant Chevron’s subsidiary, Chevron Pacific Indonesia’s (CPI), pipeline damage at the firm’s facility in Duri field in Sumatra —were highlighted as contributing factors to the decline in output.
Despite this CPI remains the largest contributor to this year’s oil output by producing 343,212 barrels per day (bpd) followed by state-owned Pertamina EP with 127,889 bpd and France-based Total E&P Indonesie with 66,400 bpd.
Looking forward to 2013, the government will seek $31.75 billion in state revenue from the oil and gas sector under the year’s state budget, this is 12 per cent lower from this year’s state revenue’s realisation.