Upstream Oil and Gas Industry Efforts to Reach 1 Million BOPD & 12 BSCFD: New Vision of Governing the Ungovernable

In addition to domestic issues, factors that also influence the development of Indonesia's upstream oil and gas industry are certainly inseparable from the current global conditions. The Covid-19 pandemic, which resulted in an imbalance between supply and demand, finally became one of the factors for oil price fluctuations. F

or the first time in history, the world is witnessing a very extreme downward trend in oil prices, where the price of crude oil futures contracts for WTI touched a price of minus USD 37.63. As the oil prices continue to fluctuate, various oil and gas companies try to prepare strategies for managing existing field operations. 

Not a few large oil and gas companies, such as ExxonMobil, Shell, Chevron, BP, Eni, have decided to cut their investment, especially in the exploration and development of new fields. The trend of intensive global investment towards renewable energy and various countries that provide more attractive fiscal facilities for the oil and gas industry have made global financing for upstream oil and gas investment more limited and competitive. 

Of course, this condition has an impact on the portion of investment entering Indonesia which is also getting smaller.

In response to domestic and global challenges, four strategies were implemented in an effort to achieve 1 Million BOPD & 12 BSCFD by 2030, such as maintaining existing production levels, accelerating resources and becoming oil and gas reserves, accelerating the implementation of Enhanced Oil Recovery (EOR), and encouraging massive exploration activities. 

These various efforts should be based on changes mindset that current upstream oil and gas industry is no longer an ordinary business. 

Reflecting on the successful efforts in another countries, such as relying on technology, expanding to frontier locations, improving fiscal policy, being open to FDI, and improving the business climate in an integrated manner, can be served as a benchmark for oil and gas industry in Indonesia in developing a new paradigm to improve domestic oil and gas production. 

Opportunities for the development of upstream oil and gas activities can only occur with continuous exploration activities and supported by the stakeholders involved.

"Always expect the unexpected. The oil and gas industry is terrible at predicting anything. Always have a back-up plan." 

Oil and gas industry as an industry with high risk, high technology, and high cost always be faced by uncertainty. All the stakeholder involved in this industry must be able to have capability in overcoming the unexpected. There is no exception, this also applies to the upstream oil and gas industry in Indonesia. 

Indonesia needs to take the momentum by changing approaches and policies that are more consistent to bring back our country as an upstream oil and gas investment destination. 

The courage to make a breakthrough that makes the risk-and-reward concept fulfilled is the key to the emergence of a new business scheme that is different from the usual and there is also a more well-organized policy scheme so that the Indonesian upstream oil and gas industry can be revived and achieve the shared vision that has been proclaimed to realize national energy security, namely the effort to reach 1 Million BOPD & 12 BSCFD by 2030.