PHE CEO Reveals Strategies to Counter Natural Decline in Indonesia's Oil Production
PT Pertamina Hulu Energi (PHE) has developed strategies to counter the natural decline in oil production across Indonesia’s oil fields. This is to ensure national energy supply stability amid challenges from aging wells.
PHE CEO Awang Lazuardi explained that without aggressive field efforts, national oil and gas production would automatically decline each year. For oil, the average annual decline is 24%, while for gas it reaches 21%.
“We must understand that in the oil and gas business, we must combat natural decline, with an average of 24% for oil and 21% for gas,” he said during a hearing with the House of Representatives’ Commission XII in Jakarta on Monday, 25 May 2026.
To counter the 24% oil production decline, the company relies on thousands of daily operational activities. PHE aims to execute large-scale development drilling and well maintenance to ensure optimal production across all operating areas.
“To counter this decline, we carry out numerous activities, including nearly 900 development drilling and exploitation wells, around 1,300 workovers, and over 37,000 well interventions,” Awang stated.
Additionally, the company employs Enhanced Oil Recovery (EOR) technologies, including steam and chemical injection, focusing on mature fields to extract remaining oil reserves that are difficult to produce.
“However, for existing assets, we also strive to increase production not just to counter decline. How? Through multistage fracturing and developing EOR methods using steam or chemical injection,” he added.
The company is also conducting aggressive exploration activities, including non-conventional oil (NCO) development in Riau. New reserves discovered through exploration in new operating areas are expected to secure Indonesia’s long-term energy supply.
“Exploration areas include Binaya, Lavender, and Bobara. These will be our lifeline moving forward and could be game-changers if the exploration yields significant results,” he concluded.