Indonesia eyes investments

Indonesia is planning to overhaul its energy policy in the hope of attracting USD 200 billion of investments over the next decade, international media reported on Tuesday.

The changes centre on providing financial incentives to multinationals including tax-free imports of key equipment and more direct venues to recover costs, Bloomberg reported. In January, the government vowed to lower the share of production reserved for it from 70% to 52% for gas and from 85% to 57% for oil.

Also in January, the state oil company Pertamina announced it had earmarked some USD 54 billion of investments by 2025 in an effort to raise domestic production of oil, gas and geothermal energy in Indonesia by some 185% to 1.91 million boepd.

The planned amendments of the legal framework of exploration and development also come in the wake of significant reforms in recent months that included the change of leadership of Pertamina and a push toward further transparency.

Indonesia is to offer 14 new oil and gas blocks, mostly situated in offshore fields, to investors in the next few weeks. By 2019, crude production is projected to surpass 1 million bopd, up from 800,000 bopd currently, the country’s Energy and Mineral Resources Minister Ignasius Jonan told Bloomberg.

The country is also looking to upgrade its refining capacities in order to decrease its dependency on imported fuels.