OPEC happy with RI's membership: Govt

OPEC happy with RI's membership: Govt

Leony Aurora, The Jakarta Post, Jakarta

The Organization of Petroleum Exporting Countries (OPEC) has no
problem with Indonesia's membership, even if the country becomes
a net crude oil importer, a top official says.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro
said according to OPEC, what was important was that Indonesia,
the organization's second-smallest producer, was a net exporter
when it became a member.

"Once you're inside, you continue to be a member. OPEC has no
problem (with Indonesia's membership)," he said on the sidelines
of a seminar on oil and gas here on Wednesday.

The government has said that it was considering pulling out of
the organization due to the country's falling crude oil output,
which may lead to Indonesia becoming a net crude oil importer in
the future.

A team tasked with reviewing the country's membership has
recommended that Indonesia reduce its status from member to
"observer" to avoid paying US$1 million a year in fees.

The change would allow the country to be within the OPEC
circle without spending much-needed budget money.

Aging oil fields and lack of new exploration have meant the
country's crude oil output has steadily declined by 5 percent a
year. At present, Indonesia produces less than one million
barrels a day, far below the 1.425 million barrels quota set by
OPEC.

This low output made Indonesia a net crude oil importer for
about four months last year.

"We are still a (crude oil) net exporter now, although the
difference is very small," Purnomo said.

Due to increasing fuel demand and the limited capacity of
local refineries Indonesia has also had to import 400,000 barrels
of refined fuels a day, making the country a net exporter of fuel
products, both unprocessed and refined.

Regarding total OPEC production, Purnomo said OPEC had not
decided yet if it would add 500,000 barrels of oil a day to its
quota in the market to ease oil prices.

"Oil prices are lower now as the stockpile in the United
States is strong," the minister said.

The United States consumes some 20 million barrels of oil a
day, of which half is imported.

OPEC raised its quota by 500,000 barrels a day to 27.5 million
barrels a day last month.

"We (OPEC) will decide in our meeting in June about the
additional quota," Purnomo said.

According to Bloomberg, crude oil futures in New York have
fallen 15 percent since reaching a record $58.28 a barrel on
April 4 as U.S. inventories rose and OPEC increased output.