Jakarta. Indonesia is set to exceed its oil and gas production target this year for the first time since 2008 with production from Cepu block, the country's largest oil field, has managed to operate in full capacity since the beginning of the year.
The country produced 822,000 barrels of oil per day by November, higher than 820,000 bpd aimed at the revised 2016 state budget, said Taslim Z. Yunus, a spokesman at upstream oil regulator SKK Migas on Friday, (23/12) as quoted by Antaranews.com.
Gas production clocked in 6,643 million standard cubic feet per day (mmscfd), exceeding the 6,438 mmscfd target set in the budget, Taslim said.
This year oil production was also marked a production of above 800,000 bpd mark after the country fell short in 2014 and 2015.
Banyu Urip projects in Exxon Mobil's Cepu block faced several setbacks in those years. But today it churns out 185,000 bpd a day at full capacity, a crucial contribution to Indonesia's long-term efforts to meet rising domestic oil demand.
Higher production should help lessen the blow on the state budget stemming from low oil prices in the first half of this year.
SKKMigas data showed that the average Indonesia crude oil price (ICP) was at $39.2 a barrel, slightly below the $40 per barrel price tag set in the state budget.
"With this conditions, we can expect state revenue from upstream oil and gas sector to reach $9.3 billion or around Rp 125 trillion," Taslim said.
Indonesia targets to produce 815,000 bpd next year as outlined in the state budget, but Taslim said there is a chance of 10,000 bpd additional production next year as several oil firms implement new drilling or lifting technologies in their fields.
Pertamina EP, a subsidiary of state energy firm Pertamina, has begun using electric submersible pump in some of its oil fields. Meanwhile, Exxon Mobil is waiting for approval from the Forestry and Environmental Ministry to ramp up Cepu block production to 200,000 bpd, despite concerns an increase in production will reduce ground water reserves.
Last month Indonesia suspended its membership within the Organization of Petroleum Exporter Countries, or OPEC, just 10 months after rejoining the body, in a move to avoid the cartel's oil production cut for next year.