Smog Hazard disturbs Oil and Gas Production in Tangguh Refinery

KATADATA - The smog hazard from the burning of forests and lands in various places of Indonesia in the last two months also affect the national oil and gas production activity. The impact is varied, starting from a halt in operational activities up to a decline in the oil and gas lifting production. 

The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Chief, Elan Biantoro, said that the smog hazard in West Papua has disturbed the operational activities of Tangguh LNG refinery in Bintuni Bay. As the result, one of the train, which is Train 1 Tangguh, has stopped being productive for two days on October 17 to 18. 

“The smog has quickly made the filter to be dirty. As the result, the alarm sounds every time, which makes maintenance time to occur all the time,” Elan said to Katadata, Thursday (22/10). 

Right now, Train 1 Tangguh is back to be operational. But, the production is not fully optimized yet, which is only 600 million standard cubic feet per day (MMSCFD). 

Even though the operation had stopped for a while, BP Berau Ltd as the operator of Tangguh LNG does not suffer from real material loss from the hazard. BP still has a large liquid natural gas reserve to be distributed to the consumers. “The loss can’t directly be calculated since the commitment to the buyers is still guaranteed,” Elan said. 

Dharmawan Samsu, Head of Country BP Indonesia, indirectly admitted the inident. He explained that the increase in heat / fire spots in West Papua lately has caused the smog to pollute the air quality around Tangguh and the surrounding area. But, the condition does not affect LNG delivery schedule. “The safety aspect is still BP main priority and we keep on fulfilling our commitment towards our stakeholders,” Dharmawan said to Katadta via e-mail, Friday (23/10). 

For additional information, LNG Tangguh is refining facility to process liquid natural gas from the six gas locks in Bintuni Bay with total reserve to stand at 14.4 trillion cubic feet. Tangguh owns two refineries, with the first production to be at 2009. Right now, Tangguh is planning to build Train 3. BP Berau owns 37.16% of shares in LNG Tangguh, while several other business partners are MI Berau B.V., CNOOC Muturi Ltd., and Nippon Oil Exploration (Berau) Ltd. 

The smog hazard also disturbs oil and gas mining operations in several areas of Indonesia, like in Kalimantan and Sumatera. “Several wells are having an unplanned shutdown due to the smog,” Elan said. Besides in Papua, several oil and gas blocks in Jambi, Riau, and Siak are also disturbed by the smog. 

And as the result, the yearly disaster has disturbed national oil and gas production. Based on the report that SKK Migas received last Wednesday (21/10), the decline in oil and gas production, due to the smog hazard, reaches 15 thousand barrels per day (bpd). 

Even though there is a decline in production, Elan wishes so that the target lifting of oil this year, which is 825 thousand bpd, can be achieved. One of the ways is to boost this year’s peak of production of Banyu Urip Field in Cepu Block, East Java. “Let’s hope so that by mid of November they can be fully operational with full capacity,” Elan added. 

The oil and gas business players are also complaining about the smog, which disturbs their operational and production activities. Moshe Rizal Husin, a member of nonconventional committee of Indonesian Petroleum Association (IPA), said that the air transportation is disturbed by the smog, which causes a frequent schedule delay and changes of route. As the result, the operational cost swells. 

The association is asking the local governments to do all kinds of preventive attempts and to find solutions regarding the burning of the forest in East Kalimantan, especially near the oil and gas contractors work areas. “The lands around our wells (IPA members) in East Kalimantan are being burnt intentionally by certain people,” Moshe said. There is a concern that the fire can spread to the well installation area, which has a very high risk of danger.