Jakarta, The Indonesia Post – Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif revealed that the upstream oil and gas industry still plays an important role in the energy transition era.
Arifin said this when opening the Indonesian Petroleum Association (IPA) Convention and Exhibition (Convex) 2023 with the theme Enabling Oil & Gas Investment and Energy Transition for Energy Security at ICE BSD, Tangerang, Banten, Tuesday.
According to Arifin, quoted from a statement received in Jakarta, Tuesday, there are several ways to ensure that the upstream oil and gas industry continues to grow to meet demand while at the same time playing a role in efforts to reduce carbon emissions.
Efficient use of energy to reduce greenhouse gas emissions in operational activities is the easiest way that can be taken by business actors.
“In addition, there is also a reduction in exhaust gas, regulating methane gas emissions and in parallel increasing the use of low-carbon power plants utilizing new, renewable energy sources. The next step is to increase gas use, initiate the use of efficient technology, and develop low-carbon mobility, such as the use of electric vehicles, biofuels, LNG,” said Arifin.
He said based on data from BP statistics, to meet energy needs, oil production continued to increase from 88.6 million barrels per day in 2012 to 93.8 million bpd in 2022. Meanwhile, gas production has also increased by around 20 percent in the last 10 years with an average gas consumption increasing 1.7 percent per year.
The data shows the important role of the oil and gas sector in meeting affordable energy needs, especially for the transportation and industrial sectors in line with the economic growth of various countries, including Indonesia.
Furthermore, Arifin explained that the development of hydrogen must also be continuously improved. According to him, hydrogen technology will answer the challenges of a low emission future industry. This is supported by the ability of the oil and gas industry which has experience and qualified capabilities to develop and produce hydrogen.
Apart from that, he said, the most crucial thing in the upstream oil and gas sector at the moment is the implementation of carbon capture storage/carbon capture utilization and storage (CCS/CCUS). Moreover, in 2023 the government will issue new regulations regarding CCS/CCUS in the oil and gas business.
“The regulation describes CCS and CCUS as promising technologies for reducing carbon emissions in order to pursue the net zero emission (NZE) target in 2060 or sooner,” said Arifin.
Currently, there are 15 CCS/CCUS projects being worked on in Indonesia, including CCS Gundih Enhanced Gas Recovery (EGR) in Central Java and Sukowati in East Java.
Meanwhile, the project that will be implemented soon is at CCUS Tangguh which is targeted to reduce carbon emissions by 25 million tons of CO2 and be able to increase gas production up to 300 BSCF in 2035.
“This project is targeted to be onstream in 2026,” said Arifin.
Meanwhile, IPA President Yuzaini Md Yusof said in his remarks that Indonesia is one of the countries that is moving fast enough in implementing CCS/CCUS. Some things that must be prepared, including fiscal policy, tax credit and carbon price policies and carbon storage readiness.
“Many high-risk projects require regulatory support, with many CCS/CCUS projects depending on regulatory support and commercial attractiveness, there is still a lot of work to be done,” said Yuzaini. (mhn/bbs)
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