Govt aims to reduce cost of decommissioning work
Govt aims to reduce cost of decommissioning work
Fitri Wulandari, The Jakarta Post, Jakarta
The government is seeking ways to reduce the high cost of
removing infrastructure facilities at depleted offshore oil and
gas fields, according to a senior official.
Director general of oil and gas Iin Arifin Takhyan said that
one of the options was to use a "certain technology" so that the
platforms could still be used in other oil and gas projects.
The removal of offshore platforms (technically known as
decommissioning) is crucial so as not to impede international sea
traffic, especially in light of the fact that this country is
between two major oceans and some of the facilities are located
along some of the main sea lanes.
Iin acknowledged that the cost of removing the platforms was
huge, depending on the weight and the depth of the platform. A
platform weighing over 500 tons at a water depth of 100 feet
costs between US$600,000 and $1.3 million to decommission.
According to government data, there are currently 448 offshore
platforms which are used for wellheads, accommodation facilities,
crude oil processing, liquefied natural gas (LNG) processing and
loading/unloading facilities. They are scattered throughout the
Java Sea, the Malabar Strait, Natuna Sea and Malacca Strait.
So far, only 21 of the 448 platforms have been decommissioned.
Since 1994, oil and gas contractors have been obligated to
bear the cost of decommissioning. But the government is
responsible for the decommissioning of facilities at oil and gas
projects approved before 1994.
The British government has signed an agreement with the
Indonesian government, under which the former would provide
technical help to ensure a cost effective decommissioning
process.
Although the country is known as a major oil and gas producer
in Asia, Minister of Energy and Mineral Resources said that the
decommissioning work is relatively new for the country.
"In the future we have to think about how to reuse this
infrastructure after the oil and natural gas resources run out.
And also who will bear the cost of removal," he said.
Iin said that since 1994, the oil and gas contractors have so
far preferred to allocate funds for other investment purposes.