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.