Government Targets Reactivation of 6,305 Old Wells to Boost Oil and Gas Lifting
JAKARTA — The government is accelerating the reactivation of 6,305 old wells that still possess hydrocarbon potential in order to increase national oil lifting. Optimising existing wells is considered the fastest means of boosting production compared to opening new exploration areas.
Of the 6,305 idle wells, 787 can be reactivated and 3,972 have potential for cooperation arrangements. “This effort is important to drive additional Indonesian oil production,” said Energy and Mineral Resources Minister Bahlil Lahadalia.
The government is relying on advanced technology to increase national oil and gas lifting. Minister Bahlil stated the government remains committed to raising lifting figures, even though crude oil output in 2025 already exceeded the state budget target. The primary weapons for optimising lifting are the application of advanced technologies at existing oil and gas wells, including Enhanced Oil Recovery (EOR), fracking, and horizontal drilling.
However, Bahlil acknowledged that implementing such technologies requires substantial investment, presenting an economic challenge for contractors. The government has therefore granted flexibility to oil and gas contractors (KKKS) to choose between Gross Split or Cost Recovery contract schemes for exploration and production activities.
Beyond technology, the government is also accelerating the realisation of projects that have completed their Plan of Development (POD) but have yet to enter construction and production phases. Bahlil emphasised that the government will take a firm stance against contractors that fail to promptly execute work for which permits have already been granted.
As of January 2026, the government has prepared 110 potential new oil and gas working areas covering both conventional and non-conventional resources. Of these 110 areas, 19 have been awarded, 39 are at the joint study stage, and 52 remain as potential areas. These encompass conventional as well as non-conventional resources such as shale gas and coal bed methane.
The government has set a target of 610,000 barrels per day for oil lifting in 2026. Despite the challenge of natural decline, performance in 2025 provides grounds for optimism, with oil lifting reaching 605,300 barrels of oil per day (BOPD), equivalent to 100.05 per cent of the state budget target.
Indonesia once enjoyed a golden era of oil production but has experienced a decline since 1997. The country’s crude oil production profile has shown a downward trend over the past three decades, falling from 1.52 million barrels per day in 1997 to 580,000 barrels per day in 2024.