Minister Arcandra: New Technology to Accelerate Oil and Gas Output

Minister of Energy and Mineral Resources (EMR) Arcandra Tahar will promote the use of new technology to increase oil and gas production. New technology is necessary because the characteristics of Indonesia’s oil and gas fields have changed.

Arcandra said the nation no longer had huge oil and gas reserves, and it had also been falling short on new discoveries. If it continued to rely on outdated technology, then production would decline even further. (Read: Entering a New Era, Minister Arcandra to Focus on Revision of Oil and Gas Law).

New technology is required to address this. “Let’s try using new technology. If we just think of new technology as risky and never take the risk, when will be able to achieve something better?” he said during a press gathering at the EMR Ministry office in Jakarta last Friday (29/7).

He said one of the new technologies that could be adopted is the multi-column tension leg platform invented by Ed Horton. This technology is designed for offshore marginal shallow-water development at depths of 300 - 1,500 metres.

Indonesia could also try using the enhanced oil recovery (EOR) method, which aims to increase the volume of crude oil that can be extracted from a well.  

EOR method would be appropriate because there are no more large new reserves. The nation can now only maximise extraction from existing crude oil fields. The minister explained that when a field that is declared spent, it still has 50 percent to 60 percent reserves.

The ministry’s Director General of Oil and Gas I.G.N. Wiratmaja Puja said this would be the right moment to adopt new technology while crude prices are still low. The cost of using new technology would be lower as well. However, the development of new technology is hindered by the safety regulation “Mijn Politie Reglement” Staatsblad 1930 No. 341, or State Police Regulation of Mining 1930 No. 341. “We have a rigid regulation that prevents the use of new technology and investments,” he said.

Meanwhile, parliamentary Commission VII member Satya Widhya Yudha said technology is crucial to increasing production. However, the state must also be careful about which type of technology it decides to use. “So the state does not become a platform for foreign countries to test (their technology) using cost recovery funds,” he told Katadata on Monday (1/8). (Read: Jokowi Pushes for Revision of Upstream Cost Recovery and Tax Rules).

The state must also be careful to avoid conflicts of interest when selecting which type of technology to use, such as the technology that has been patented by Arcandra.

Arcandra and his former colleagues patented several types of technology during his time at Petroneering Consulting Houston, including the Tension-Leg Platform System Anchoring, Multi-Column Tension Leg Platform, Unconditionally stable floating offshore platform, Articulated flowline connection, Semi-submersible offshore structure, Articulated Flowline Connection, Means For Applying Tension To A Top Tension Riser, and Modular integrated semisubmersible. 

These patents are protected by the United States Patent and Trademark Office (USPTO). The McT (Multi Column TLP) Floating Platform technology has been used in the L-Parigi Field, which is operated by Pertamina EP.

Reforminer Institute advisory board member Pri Agung Rakhmanto also backed the use of new technology in the nation’s upstream oil and gas industry. However, he also warned of the possibility of conflicts of interest over the use of new types of technology. It would be a shame if that happened, he said. (Read: Luhut to Help Arcandra to Resolve Energy Ministry’s Problems).

Pri said Arcandra’s statement concerning the EOR method is normative. What is important are the concrete steps for implementing new technology, such as the creation of a road map. “So it’s about how the concrete steps for using the technology would be implemented. Will we be using sea deep-sea technology for Indonesia’s eastern region? Who will be the investors? And so on,” he said to Katadata.