Pertamina to up investment to Rp 5.9t

The Jakarta Post, Jakarta

State-owned oil and gas company PT Pertamina plans to boost investment this year to Rp 5.9 trillion (US$702 million) from Rp 4.7 trillion in the previous period in a bid to increase oil and gas production.

The investment target was approved at the company's annual shareholders meeting on Wednesday.

"Looking ahead, we'll boost our exploration activities. This is in line with our core business in the oil and gas sector," Pertamina finance director Alfred Rohimune told the press.

He also said that Pertamina was targeting a higher profit after tax of around Rp 5.30 trillion this year, compared to Rp 3.90 trillion last year.

Pertamina is intensifying oil and gas exploration to jack up output amid growing demand at home. Experts had previously said that new oil finds are essential if the country is to avoid becoming a net oil importer in 10 years time.

The country needs new oil discoveries of between 400 million and 500 million barrels annually, which is the same amount of crude oil currently produced by the nation each year, according an estimate from the oil and gas upstream authority, BP Migas.

BP Migas said that as of the end of 2003 Indonesia's proven and potential oil reserves stood at 9.75 billion barrels, which at the current rate would be enough to last for 20 years.

Indonesia now produces 1.081 million barrels per day.

Pertamina also needed to intensify its exploitation of aging oil fields. Such fields normally still contained oil but required advanced technology for its extraction.