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| An offshore rig operates on April 2, 2023, in an oil and gas field managed by Pertamina Hulu Energi Offshore North West Java off the coast of Indramayu, West Java. — Photo The Jakarta Post/ANN |
JAKARTA – The government is mulling over a plan to build an oil storage facility on an island adjacent to Singapore, according to Energy and Mineral Resources Minister Bahlil Lahadalia, as part of the country’s pursuit of energy sovereignty.
Bahlil said on Wednesday that an oil storage facility would provide a 30- to 40-day reserve supply and “accommodate various types of oil” for state energy giant Pertamina to buy at low prices.
“Talking about geopolitics, if our country were at war, our oil reserves would last only 21 days,” said the minister, who is also Golkar Party chairman, after attending an event in Jakarta involving Golkar lawmakers, as quoted by Antara.
The island state has no hydrocarbon resources and imports crude oil for its refining and petrochemical industries, according to data from the United States Energy Information Administration (EIA). The data also show that Singapore imports over two-thirds of its crude from the United Arab Emirates, Qatar, Saudi Arabia and Kuwait.
The EIA’s 2021 report states that the city-state primarily shipped its refined petroleum products, including fuel, to Malaysia, Indonesia, Australia and China.
As of January 2021, Singapore’s three refineries had a total refining capacity of 1.3 million barrels per day (bpd), according to estimates from the Oil & Gas Journal.
The island state is the world’s fifth-largest refining and export hub and ranks among the top 10 petrochemical exporters globally.
In the first half 2024, Indonesia’s ready-to-sell oil production hovered at 576,000 barrels of oil per day (bopd), below the 635,000 bopd targeted for this year, according to data from the Upstream Oil and Gas Regulatory Special Task Force (SKK Migas).
Indonesia’s oil industry peaked during the 1970s and 1980s, when output exceeded 1 million bopd and oil exports drove economic growth, but production has been declining steadily since, mostly due to aging wells and a lack of new reserves.
Former president Joko “Jokowi” Widodo had asked his aides to take the necessary action to stop the decline in ready-to-sell oil and gas production, adding that officials must work hard to avoid a dip of “even just a liter”.
The Energy Ministry is thereby planning to optimize existing oil wells as part of a larger effort to reduce energy import costs, estimated at up to Rp 500 trillion (US$31.38 billion) per year.
The country has around 44,900 oil wells, 16,600 of which are idle, according to the ministry’s data. Of these, around 5,000 idle wells can be optimized to both domestic production. — THE JAKARTA POST/ANN
Source: Vietnam News/ Vietnam Insider