Tuesday, June 21, 2016

Indonesia Rejects Exxon Proposal to Boost Cepu Block Output

Jakarta. Indonesia has rejected a proposal to increase crude output from the Cepu block operated by US oil and gas giant Exxon Mobil to up to 200,000 barrels per day, the country’s upstream oil and gas regulator (SKKMigas) told parliament on Tuesday (14/6).

SKKMigas disagrees with Exxon’s analysis of the potential for the project based on environmental and subsurface considerations, SKKMigas chief Amien Sunaryadi said.
Exxon proposed the increase to 200,000 bpd last month noting potential in the project’s reservoirs but said the decision was in the government’s hands.


Govt, House Agree to Lower Target on Oil, Gas Production

Jakarta. The government and the House of Representatives budget committee have agreed on Wednesday (15/06) to lower the oil and gas production target in the 2016 revised state budget, a senior official said.

The oil production target is reduced to 820,000 barrels per day from 830,000 bpd in the initial budget, while gas production is lowered slightly to 1.15 million barrels of oil equivalent per day from the 1.16 million in the 2016 state budget.

The committee earlier agreed to a lower oil price assumption at $40 per barrel from $50 initially.

While the figures are slightly more optimistic than the government's proposal, the government still needs a day to calculate their impact on this year's revenue and subsidy spending, Ministry of Finance fiscal policy head Suahasil Nazara said.

According to 2016 state budget revision proposed by the government earlier, total revenue would reach Rp 1,733 trillion ($129.9 billion), almost 5 percent lower than the target in the original budget, as it expects revenue from oil and gas to drop by more than a fifth compared to last year.

Jakarta Globe

Thursday, June 9, 2016

GE Sets Up Gas Turbines for 100-MW Electricity Project in Gorontalo

Jakarta. General Electric has set up turbines for a 100-megawatt gas-fueled power plant in Gorontalo province this week, marking the company's first electricity project as part of Indonesia's grand plan to increase its power capacity to 35,000 megawatts by 2020.

The four TM2500 aeroderivative gas turbines have been installed at state utility company Perusahaan Listrik Negara's power plant in Paguat, Pahuwato district.
GE claims that the turbines can be installed much faster than other power generators, taking only six months from initial construction to becoming fully operational.

"Our technology has been successfully installed in various countries such as Egypt, Algeria, Greece and Japan," GE Indonesia chief executive Handry Satriago said in a statement. "GE's aeroderivative turbines' easy installation makes it ideal for application in remote areas."

Output from the four turbines will be used to maintain voltage stability and meet Sulawesi's electricity needs.

Jakarta Globe

Wednesday, June 8, 2016

Weather May Disrupt Indonesia Coal Output From July to Jan 2017: Agency

Jakarta. Coal production and exports from Indonesia's Sumatra region may be disrupted by abnormally wet weather from July until January 2017, the country's national weather agency (BMKG) said on Friday (03/06), as a result of the La Nina weather phenomenon.

"Transportation is disrupted because it correlates with bad weather. Mining areas are more vulnerable because they are usually steep so the potential for landslides is higher," Nurhayati, head of the Climate, Agroclimate and Maritime Affairs division at BMKG told reporters.
Nurhayati added that river depths would be affected by the forecast additional precipitation, potentially hampering coal barges.

Production and exports from the country's top coal producing region of Kalimantan could be disrupted from October to January, Nurhayati added.


Thursday, June 2, 2016

ABB Joins Hands With PLN to Boost Java, Bali Electricity Supply

Jakarta. Global power and automation technology company ABB Group will support state utility Perusahaan Listrik Negara to provide electricity infrastructure and boost supply in Java and Bali, a senior official said in a press conference on Wednesday (01/06).

ABB will help PLN to strengthen the efficiency of electricity transmission and distribution networks on the two islands as part of a three-year contract worth $11 million signed in the first quarter of 2016 and which commenced in the second quarter.

The Zurich-based company said Indonesia is likely to see higher power shortages in the future, with the country's middle-class expansion predicted to drive greater electricity demand in the future.

The government has forecasted that electricity demand was likely to rise by 9 percent on average per year over the next decade.
PLN has set a target to increase the country electrification rate to above 95 percent by 2020 and it has ambitious plans to add an additional 35,000 megawatts of power to the national grid by 2019.

"We are working with PLN for the addition of the 35,000-megawatt power supply," ABB 
Indonesia country manager Richard Ledgard said. He added that the company was also making an effort to develop local competence and engineering skills. ABB seeks to expand its manufacturing footprint in Indonesia in the coming years.

ABB will design, engineer, supply and install the substation extensions, including switchgear, transformers, state-of-the-art control and protection systems as well as ancillary equipment for the joint project.

The product scope includes 11 transformers with a capacity of 60 megavolt-amperes, high-voltage air-insulated switchgear for eight substations, high-voltage gas-insulated switchgear for one substation as well as the replacement of control systems for uprating the transformers in three other substations.

The project, which is funded by the Asian Development Bank, is scheduled to be completed in 2017.

"We are pleased to support PLN in its efforts to strengthen the power infrastructure in Indonesia and enhance the electricity supply. ABB's track record for managing complex projects and our technologies will help deliver customer value," said Claudio Facchin, the president of ABB's power grid division.

As reported in October 2015, the company inaugurated a new manufacturing facility for medium-voltage air-insulated switchgear in Tangerang, Banten.

The facility is part of ABB's $20 million investment in Indonesia, which also included the establishment of low-voltage product factory in Cibitung, West Java, in 2014.
ABB is also a global supplier of air-insulated, gas-insulated switchgear and hybrid substations 
with capacities of up to 1,100 kilovolts.

The company further provides utility, industrial and commercial customers as well as sectors such as railways, urban transportation and renewable resources. The ABB Group of companies operates in 100 countries and employs about 135,000 people.

Jakarta Globe

Monday, May 30, 2016

Pertamina to Aquire Minority Stakes in Two Rosneft Oil Blocks

Jakarta. State-owned energy company Pertamina will acquire minority stakes in two oil exploration blocks belonging to Russian energy giant Rosneft, an executive said earlier this week.

The acquisitions form part of an agreement between the two companies on Thursday (26/05) to cooperate in the oil and gas sector, including plans to develop a refinery together.

"Pertamina targets production of around 35,000 barrels of oil per day, with 200 million barrels of oil reserves from the Russian blocks," Pertamina president director Dwi Soetjipto said. He added that Pertamina had been studying the two Russian oil blocks.

The two companies have agreed that Pertamina will have a share of between 10 percent and 15 percent in those two blocks.

Didier Casimiro, Rosneft's vice president for refining, petrochemicals, commerce and logistics, said he has yet to reveal which blocks will be acquired by Pertamina.

"We still keep our options open if Pertamina is willing to be involved in the development of refinery," Casimiro said.

Jakarta Globe

Scientists, Investors Seek to Identify Financial Risks of Climate Change

Oslo. A Norwegian group of climate scientists will form an alliance on Thursday (19/05) with investors including BlackRock Inc and the World Bank to try to assess the financial risks of rising global temperatures.

The Center for International Climate and Environmental Research, Oslo (CICERO) said it wanted to help investors judge risks from global warming such as more heatwaves, floods, downpours, the extinction of animals and plants and rising seas.

The head of CICERO, Kristin Halvorsen, said the aim was to help investors and researchers to "understand each other more easily so that the financial sector can define climate risks".
"We speak very different languages. Research and investment are two different worlds," Halvorsen, a former Norwegian finance minister, told Reuters on Wednesday, noting that the financial sector's main concern was the return on its investments.

Representatives of BlackRock, the world's largest asset management company, World Bank Treasury, Swedish pension fund AP2, Nordic bank SEB and Norwegian bank DNB would be among those on an advisory board for the CICERO Climate Finance project, to be launched on Thursday.

The first meeting would work to define common projects. Some investors, for instance, are pulling out of companies that mine or generate power from coal, reckoning that reserves of coal will steadily lose value from a shift to cleaner energies.

And extreme events such as wildfires, heatwaves or floods can disrupt investments in infrastructure, ranging from road bridges to oil pipelines. But it is hard to assess risks for individual places.

"If extreme events become more frequent, what does that mean for infrastructure?" said Christa Clapp of CICERO, an expert in assessing the environmental quality of green bonds.

Ulrika Danielson, spokeswoman for AP2 which has about 300 billion Swedish crowns ($36.19 billion) under management, welcomed the plan to do more to unite research and investment.
"We look at climate change as a risk in our portfolio," she said.

Halvorsen said interest from investors to learn about climate change had risen after 195 nations agreed a global deal in Paris last December to combat climate change, shifting the global economy from fossil fuels.

Reuters, Jakarta Globe