Oil Production in Cepu Block Declines at Start of Year, Exxon Provides Explanation
Jakarta, CNBC Indonesia - The US-based oil company ExxonMobil Cepu Ltd has revealed the reasons behind the failure to meet oil production targets up to the end of May 2026.
According to data from SKK Migas, ExxonMobil’s oil lifting as of 31 May 2026 was recorded at 129,915 barrels per day (bpd), representing 87.5% of the 148,500 bpd target set in the 2026 State Budget (APBN).
Senior Vice President of ExxonMobil Indonesia, Muhammad Nurdin, explained that the decline in oil production was primarily caused by the natural decline of the oil and gas fields currently operated by the company.
“As the Head [of SKK Migas] stated, we are indeed experiencing a decline in production,” Nurdin said during a Hearing (RDP) with Commission XII of the Indonesian House of Representatives (DPR RI) on Wednesday (3/6/2026).
Nevertheless, the company, alongside its partners and SKK Migas, has prepared several strategic steps to optimise production. One of these strategies involves maximising available subsurface opportunities within the field.
“Furthermore, another equally important strategy is how we maximise facility reliability, meaning ensuring there is no downtime that would result in production decreases from the Banyu Urip field,” he added.
Previously, during the same session, the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) disclosed the reasons behind the low realisation of oil production at the start of the year, noting that several factors were involved.
Head of SKK Migas, Djoko Siswanto, stated that the low production realisation was influenced by several operational disruptions. In the first quarter, for instance, a pipeline leak belonging to PT Transportasi Gas Indonesia (TGI) impacted seven contractors (KKKS) at the Dumai Terminal and two gas suppliers.
“If we look at the production realisation graph, January was very low because a pipeline rupture caused production for seven KKKS to temporarily halt,” said Djokos.
Following the resolution of those disruptions, production had briefly increased. However, new challenges emerged in the second quarter, including electrical disturbances in the Rokan Block operational area, operated by PT Pertamina Hulu Rokan (PHR), and a production decline in the Banyu Urip Field, Cepu Block, operated by ExxonMobil Cepu Ltd.
“This was followed by electrical problems in PHR and continued with the production decline in Banyu Urip, where these two oil blocks serve as the largest pillars of our national production,” he said.
It is noted that the realisation of national oil lifting as of 31 May 2026 reached 576.2 thousand barrels per day (bpd). This figure consists of oil production of 491.3 thousand bpd, condensate of 55.8 thousand bpd, and NGL of 29.1 thousand bpd. This figure remains lower than this year’s lifting target, which is set at 610 thousand bpd.
ExxonMobil Cepu Ltd is currently the second-largest oil producer in Indonesia, following PT Pertamina Hulu Rokan (PHR), which operates the Rokan Block.