Page 1 - Indonesia Oil and Gas Report Q4 2012 Published: August 2012

No. of Pages: 117

Price: US $ 1175

Oil and gas exports form one of the key pillars of the Indonesian economy although the outlook for the sector is becoming increasingly uncertain given dwindling oil reserves in the country’s maturing fields. The government has recently put in place measures to incentivise oil companies to conduct deep-sea exploration in a bid to increase total reserves. Greater domestic consumption leading to higher imports and lesser exports will be a key trend in the years to come. The main trends and developments we highlight for Indonesia''s Oil and Gas sector are:  We have revised up our 2016 crude oil and gas liquids production forecast from 927,800 barrels per day (b/d) to 954,060b/d due to increased production from ExxonMobil’s Cepu field, which is to reach peak production of 165,000b/d by late 2014. Associated condensate production from Total’s South Mahakam project and Chevron’s Gendalo-Gehem development will also contribute to production growth. Nonetheless, the country will remain a net importer of oil – with 2016 consumption forecast at 1.50mn b/d as domestic electricity demand in the country expands along with economic growth.  Under current production sharing contracts (PSCs), the government takes 85% of oil production while the remaining 15% goes to the oil contractor. For deep-sea oil projects, the government is willing to decrease its stake to 65% in a bid to incentivise oil companies to conduct deep-sea oil exploration. Without the discovery of any major oil deposits, we expect the country’s proven oil reserves to decline from 4bn barrels (bbl) in 2011 to 3.62bn bbl by 2021.  Steps are being taken to cope with rapidly rising demand for fuel and electricity. The government has been considering scrapping fuel subsidies for private cars – starting on April 1 2012 in Greater Jakarta and later for other parts of Java and Bali. However, these have been met with considerable political opposition.  Natural gas production is expected to have hit a near-term peak of around 76.6bn cubic meters (bcm) in 2011. The country''s gas consumption is on the rise and is forecast to reach 54.5bcm by 2016. We expect natural gas exports to rise slightly from 33.8bcm in 2011 to 36.4bcm by 2016. Production from Indonesia''s East Natuna gas project is unlikely to start before 2022, and bringing the large-scale project onstream could cost up to US$40bn. The Natuna D-Alpha block is estimated to hold 1.29trn cubic metres (tcm) of recoverable gas reserves, making it the largest single gas field in Asia.  Domestic consumption is set to drive crude oil imports to US$18.03bn by 2016 from US$12.84bn in 2011. Natural gas exports will also be diverted domestically, with exports set to decline from US$18.09bn in 2011 down to US$16.88bn in 2016.  At the time of writing we assume an OPEC basket oil price for 2012 of US$107.05/bbl, falling to US$99.10/bbl in 2013. Global GDP in 2012 is forecast at 2.6%, down from an assumed 3.1% in 2011, reflecting a faltering recovery in the US and an uncertain eurozone debt situation. For 2013, growth is estimated at 3.2%.

Indonesia Oil and Gas Industry 2012 Table Of contents BMI Industry View 7 SWOT Analysis . 9 Indonesia Oil and Gas SWOT ... 9

Global Energy Market Outlook .. 10 Oil: Getting Closer To Emerging Markets Inflection Point . 10 Regional Energy Market Outlook .. 18 Frontier Plays & Brownfields Bolster Asia''s Upstream Outlook . 18 Indonesia Energy Market Overview .. 24 Industry Forecast Scenario ... 26 Oil and Gas Reserves ... 28 Oil Supply And Demand... 29 Gas Supply and Demand .. 31 Coal Bed Methane ... 32 LNG . 33 Refining and Oil Products Trade . 35 Revenues/Import Costs 36 Key Risks To BMI''s Forecast Scenario 36 Oil And Gas Infrastructure 37 Oil Refineries ... 37 Service Stations 39 Oil Terminals/Ports . 39 Oil Pipelines 39 LNG Terminals 39 Japanese LNG Supply Deals 43 Gas Pipelines ... 44 Regional And Country Risk/Reward Ratings .. 46 O&G Asia Risk/Reward Ratings .. 46 Indonesia Upstream Rating – Overview .. 50 Indonesia Upstream Rating – Rewards 50 Indonesia Upstream Rating – Risks . 51 Indonesia Downstream Rating – Overview .. 51 Competitive Landscape . 52 Executive Summary ... 52 Overview/State Role .. 53 Licensing and Regulation 54 Government Policy .. 54 Licensing Rounds . 56 Company Monitor ... 59 Chevron Indonesia 63 ExxonMobil Indonesia .. 66 BP Indonesia . 70 CNOOC Indonesia 74 ConocoPhillips Indonesia . 77 Total E&P Indonesie 80 Medco Energi ... 84 Eni Indonesia 87 Salamander Energy ... 90 CNPC/ PetroChina – Summary ... 94 Petronas – Summary 94 Marathon Oil – Summary 94 Hess – Summary .. 94 VICO Indonesia – Summary 95 Inpex – Summary . 95 Santos – Summary 96 Badak NGL – Summary ... 97 Serica Energy – Summary 97 AWE – Summary .. 97 Premier Oil – Summary ... 98 Others – Summary ... 98

Asia – Regional Appendix ... 100 Methodology And Risks To Forecasts ... 108 Glossary Of Terms ... 109 Oil And Gas Risk/Reward Ratings Methodology .. 111 Ratings Overview .111 Indicators .112 BMI Methodology . 115 How We Generate Our Industry Forecasts ..115 Energy Industry ...115 Cross checks 116 - Indonesia Oil and Gas Report Q4 2012  

Oil and gas exports form one of the key pillars of the Indonesian economy although the outlook for the sector is becoming increasingly uncer... - Indonesia Oil and Gas Report Q4 2012  

Oil and gas exports form one of the key pillars of the Indonesian economy although the outlook for the sector is becoming increasingly uncer...