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According to a recent report in the Jakarta Post, the Indonesian government expects to start opening tenders for shale gas field development in eastern Indonesia this year.

Shale gas is an unconventional natural gas produced from shale, and a recent study by Bandung Technology University [ITB] found that Indonesia holds 1,000 trillion cubic feet [TCF] of shale gas reserves. This is good news for the country facing a severe gas supply deficit.

Mr. Edy Hermantoro, an upstream oil and gas director at the energy and mineral resources ministry, said Indonesia was upbeat on its untapped shale gas potential, but was unable to share details on the fields numbers and location, saying that the government was preparing the regulation on this matter.

Those keen to get a headstart on the shale gas developments in Indonesia should attend 3^rd Indo OGP, where Mr. Edy Hemantoro will be speaking on, “Regulatory Outlook in Attracting Investments in Upstream Oil & Gas”. Mr. Hemantoro, who is already touching on Coal Bed Methane developments in his speech, is also expected to share some details about Indonesia’s plans to develop Shale Gas.

3^rdIndo OGP will also offer participants opportunity to touch base with Mr. Hemantoro and other top regulators including Dr. Ing. Evita Legowo, and to get their personal perspectives on the situation.

To participate in 3^rd Indo OGP, simply click on the link below to register.

Indonesia is looking to speeding up the licensing process for companies developing oil and gas projects. According to a Reuters report, Energy Mininster Dr. Saleh Zahedy Darwin issued the decree on 10 Feb.

The decree said "Oil and gas contractors must accelerate proposals for development plans after (oil or gas) finds," and added that a contractor must propose a development plan within 90 calender days. The contractor will also be expected to start development activities within 180 calendar days after the proposal is agreed, and produce oil or gas at least 2 years after development plan is agreed.

Based on previous upstream regulation, oil contractors have 6 years for exploration, and the decree proposed extending it by another 4 years. The new decree also added a 40 day time limit for oil watchdog, BPMIGAS to submit a recommendation to the energy ministry on any development plan they receive from a contractor. This means BPMIGAS will need to make a decision on the work programme and budget proposals within 40 days.

Indonesiahas struggled to attract fresh investment to develop new fields, partly due to uncertain regulations and tortuous red tape. Many of the remaining unexploited fields are also in more remote areas or under deep water, requiring high levels of investment and specialised technology.

Will the implementation of this decree turn around Indonesia’s Oil & Gas sector?

Those seeking more information on these shifts in regulatory and business environment for the country’s oil, gas and petrochemicals sector should attend 3rd Indo OGP, where they will get to hear from BMIGAS, Directorate General of Oil & Gas-Ministry of Energy and Mineral Resources, Shell, Pertamina and many other key players in Indonesia’s oil, gas and petrochemicals sector. Click on the link below to register.