Pertamina effort to manifest itself toward the world-class oil and gas company is not just a dream following the company's performance in the upstream and downstream sectors continues to increase. These state enterprises face many challenges as well as hope.
The challenge is how to Pertamina's efforts in realizing the vision of the company's world-class oil and gas as well as to improve its performance as a company a competitive state. Pertamina was born by Government Regulation No 27/1968 as a result of the merger of three oil companies, namely Pertamin, Permigan and Permina.
Ibnu Sutowo was appointed as its first director. Through Law No. 8/1971, Pertamina defined as a state-owned oil and gas company which means all the companies running their business in Indonesia must cooperate with Pertamina, both as the regulator and through cooperation contracts in the working area of Pertamina. Pertamina also acts as an operator because it managed its own working areas.
Driven surge in world oil prices, Pertamina had a golden period in the mid-1970s in which the company posted profits of Rp382, 2 billion. The amount is equivalent to 39% of total state revenues in the budget in the same year. One thing that never happened throughout history, one capable of economic sectors accounted for more than a third of total state revenue. Indonesia was transformed into one of the oil-producing country a respected world.
However, that era has passed. Pertamina is now facing various challenges. In terms of reputation, Pertamina left behind from Petronas, which formerly learned to Pertamina. Meanwhile, Pertamina still trying to get up, Petronas has entered the ranks of giant world oil and gas version of Platt and Fortune magazine.
In terms of economic performance, Pertamina also lagged. Based on the survey of Energy Intelligence, 2008, Pertamina was ranked the 30th as oil and gas company that has a net profit and total assets of the world's largest, while Petronas is ranked 18th world. Petronas even have opened outlets in Indonesia.
Pertamina effort to realize the vision of world-class companies actually been initiated since 2008 and, even in 2006 when the transformation of Pertamina triggered. Pertamina target in 2018, the company became the number one oil company in Southeast Asia. Pertamina intention to manifest itself as a world class company is not kidding. Pertamina is now different, stretching the country's current business is very promising and increasingly aggressive and expansive.
Pertamina will remain the largest oil and gas producer in Indonesia, given Pertamina performance so far does show fantastic results. In the downstream sector, until September 2010 Pertamina's oil production has reached 191,000 barrels per day (bpd) and is targeted to break the 200,000 bpd in 2011.
This figure is much higher when compared with oil production in 2009 is an average of 150,000 bpd. The key to success exceeded the production target because Pertamina has successfully acquired a number of oil and gas companies operating in Indonesia. Pertamina managed to acquire BP's Offshore West Java, including working with the NOC such as BP. Pertamina also acquired assets of Inpex West Java in September 2010.
Not only expansive in the country, the company also started to spread to other countries. Through Pertamina Upstream Energy (PHE), since 2007, Pertamina has been exploring Block SK-305 drilling off the coast of Sarawak, Malaysia, in collaboration with Petronas and Petro Vietnam. This block is predicted to have oil reserves of 541 million barrels and natural gas as much as 1.91 billion cubic feet. On the field, the PHE holds 30% stake.
In addition to SK-305, PHE also has several other blocks such as Block 17-3 and Block 123-3 in the whole Libyan-owned by the PHE. Block 17-3 is estimated to have reserves of 3.5 trillion cubic feet of gas and block 123-3 has 427 million barrels of oil reserves. PHE also pocketed a 10% stocks in Block 10 and 11.1 in Vietnam. In the block, PHE works with Petronas, Petro Vietnam and Quad Energy.
In addition, PHE also has Block 13 in Sudan and Block 3 in Qatar. On the domestic upstream sector, Pertamina, through its subsidiary Pertamina EP, also recorded remarkable achievements. As of January 2010, Pertamina EP managed to produce 130,000 bpd of oil, an increase compared to January previous year (year on year), which amounted to 125,000 bpd. Although the increment is not too fast (about 2.5%), but that achievement should be appreciated in light of the decline in the capacity of oil fields are naturally quite high which is an average of 18% per year.
Field of the central well of Pertamina EP is Java Region with a range of production 25,000 bpd, 19,000 bpd of Sumatra, 32,000 bpd Sukowati field, and Business Unit Limau with 12,000 bpd. Other fields varies between 2,000 to 10,000 bpd. Pertamina EP is the second largest oil producer after Chevron with total profit in 2009 more than Rp20 trillion (not taxed) or equivalent to 80% of the total income of the parent company.
Since established in 2003, the company that was born as a consequence of changes in the status of Pertamina into this company did show satisfactory performance from year to year. In 2003, Pertamina EP's production amounted to 95,000 bpd and jumped to around 102,000 bpd in 2006. This production continues to increase to 110,300 bpdbpd (2008). By the end of 2009, Pertamina EP has exceeded the production target of 125,500 bpd.
For natural gas sector, the average production of Pertamina EP in November 2009 amounted to 1,050 million cubic feet per day. Of these, 28% supplied to the National Gas Company (PGN), 22% to meet the needs of industry, 18% for the fertilizer industry, 18% for power supply, and 14% more to the needs of Pertamina refineries. According to data from the Ministry of Energy and Mineral Resources, Pertamina EP is the largest domestic gas supplier in Indonesia after Total Indonesia.
In the downstream sector, Pertamina also do not want to be whiz at home. Since 2006, Pertamina lubricant has been exporting products to several countries including China, Pakistan, Japan, Singapore, Australia, Malaysia and Cambodia with an average volume of 80,000 kl per year with an average export value of USD240 million per year. In addition to maintaining its market share above, the company also co-branded with local companies, including in Pakistan, Belgium, Qatar, Singapore, and Thailand.
Aviation fuel production of Pertamina has also been recognized internationally. Pertamina is working with airports has been supplying aviation fuel to Singapore, Jeddah, Dubai, Bangkok, Hong Kong and Kuala Lumpur. Not only that, the General Fuel Filling Station owned by Pertamina plans to expand into neighboring countries. In the near future, Pertamina will soon open the first retail outlets in Australia. As a result, various efforts to expand upstream and downstream sectors in the above led to bigger profits.
In 2006 the profits from state enterprises ranging from Rp19 trillion, then rose in 2007 to Rp24,5 billion and rise again in 2008 to Rp30,2 trillion. Based on data from Forbes Global 2009 and LKPP RI 2008, Pertamina is the state with the largest profit of Rp30,2 trillion, followed in second place with earnings of PT Telkom Indonesia Rp14 trillion. The increase in corporate profits in line with the increase in dividends paid to the state.
Performance as indicated Pertamina upstream and downstream sectors in the above shows that what Pertamina aspired to achieve world-class oil and gas company is not just a dream. Since the change of status of Pertamina into a company as stipulated in Law No. 22/2001 on Oil and Gas and followed by Government Regulation No. 31/2003 concerning Amendment to Form a company Pertamina, Pertamina is better. However, behind the various successes, Pertamina still has some homework to be completed.
Pertamina must minimize the cost recovery oil and gas production and more keen anticipation of external factors, especially international oil prices. Both of these affect to Pertamina business and profitability in the upstream sector. As is known, cost recovery resulting from Pertamina's production process is still relatively high. Pertamina's cost recovery during the period 2004-2006 an average of USD27 per barrel.
It is not particularly felt when the international oil price is constant in the range of USD100 per barrel, but it would be very detrimental if oil prices slumped. No less important, as a profit-oriented company Pertamina also have to maintain the quality in every product and services to suit customer satisfaction. For example, applying the standard dose at all filling stations, LPG cylinders to prevent the circulation of counterfeit, fake or lubricants on the market. All the above services must be considered because it deals directly with the daily life of people so of course directly affects the image of Pertamina.
The challenge is how to Pertamina's efforts in realizing the vision of the company's world-class oil and gas as well as to improve its performance as a company a competitive state. Pertamina was born by Government Regulation No 27/1968 as a result of the merger of three oil companies, namely Pertamin, Permigan and Permina.
Ibnu Sutowo was appointed as its first director. Through Law No. 8/1971, Pertamina defined as a state-owned oil and gas company which means all the companies running their business in Indonesia must cooperate with Pertamina, both as the regulator and through cooperation contracts in the working area of Pertamina. Pertamina also acts as an operator because it managed its own working areas.
Driven surge in world oil prices, Pertamina had a golden period in the mid-1970s in which the company posted profits of Rp382, 2 billion. The amount is equivalent to 39% of total state revenues in the budget in the same year. One thing that never happened throughout history, one capable of economic sectors accounted for more than a third of total state revenue. Indonesia was transformed into one of the oil-producing country a respected world.
However, that era has passed. Pertamina is now facing various challenges. In terms of reputation, Pertamina left behind from Petronas, which formerly learned to Pertamina. Meanwhile, Pertamina still trying to get up, Petronas has entered the ranks of giant world oil and gas version of Platt and Fortune magazine.
In terms of economic performance, Pertamina also lagged. Based on the survey of Energy Intelligence, 2008, Pertamina was ranked the 30th as oil and gas company that has a net profit and total assets of the world's largest, while Petronas is ranked 18th world. Petronas even have opened outlets in Indonesia.
Pertamina effort to realize the vision of world-class companies actually been initiated since 2008 and, even in 2006 when the transformation of Pertamina triggered. Pertamina target in 2018, the company became the number one oil company in Southeast Asia. Pertamina intention to manifest itself as a world class company is not kidding. Pertamina is now different, stretching the country's current business is very promising and increasingly aggressive and expansive.
Pertamina will remain the largest oil and gas producer in Indonesia, given Pertamina performance so far does show fantastic results. In the downstream sector, until September 2010 Pertamina's oil production has reached 191,000 barrels per day (bpd) and is targeted to break the 200,000 bpd in 2011.
This figure is much higher when compared with oil production in 2009 is an average of 150,000 bpd. The key to success exceeded the production target because Pertamina has successfully acquired a number of oil and gas companies operating in Indonesia. Pertamina managed to acquire BP's Offshore West Java, including working with the NOC such as BP. Pertamina also acquired assets of Inpex West Java in September 2010.
Not only expansive in the country, the company also started to spread to other countries. Through Pertamina Upstream Energy (PHE), since 2007, Pertamina has been exploring Block SK-305 drilling off the coast of Sarawak, Malaysia, in collaboration with Petronas and Petro Vietnam. This block is predicted to have oil reserves of 541 million barrels and natural gas as much as 1.91 billion cubic feet. On the field, the PHE holds 30% stake.
In addition to SK-305, PHE also has several other blocks such as Block 17-3 and Block 123-3 in the whole Libyan-owned by the PHE. Block 17-3 is estimated to have reserves of 3.5 trillion cubic feet of gas and block 123-3 has 427 million barrels of oil reserves. PHE also pocketed a 10% stocks in Block 10 and 11.1 in Vietnam. In the block, PHE works with Petronas, Petro Vietnam and Quad Energy.
In addition, PHE also has Block 13 in Sudan and Block 3 in Qatar. On the domestic upstream sector, Pertamina, through its subsidiary Pertamina EP, also recorded remarkable achievements. As of January 2010, Pertamina EP managed to produce 130,000 bpd of oil, an increase compared to January previous year (year on year), which amounted to 125,000 bpd. Although the increment is not too fast (about 2.5%), but that achievement should be appreciated in light of the decline in the capacity of oil fields are naturally quite high which is an average of 18% per year.
Field of the central well of Pertamina EP is Java Region with a range of production 25,000 bpd, 19,000 bpd of Sumatra, 32,000 bpd Sukowati field, and Business Unit Limau with 12,000 bpd. Other fields varies between 2,000 to 10,000 bpd. Pertamina EP is the second largest oil producer after Chevron with total profit in 2009 more than Rp20 trillion (not taxed) or equivalent to 80% of the total income of the parent company.
Since established in 2003, the company that was born as a consequence of changes in the status of Pertamina into this company did show satisfactory performance from year to year. In 2003, Pertamina EP's production amounted to 95,000 bpd and jumped to around 102,000 bpd in 2006. This production continues to increase to 110,300 bpdbpd (2008). By the end of 2009, Pertamina EP has exceeded the production target of 125,500 bpd.
For natural gas sector, the average production of Pertamina EP in November 2009 amounted to 1,050 million cubic feet per day. Of these, 28% supplied to the National Gas Company (PGN), 22% to meet the needs of industry, 18% for the fertilizer industry, 18% for power supply, and 14% more to the needs of Pertamina refineries. According to data from the Ministry of Energy and Mineral Resources, Pertamina EP is the largest domestic gas supplier in Indonesia after Total Indonesia.
In the downstream sector, Pertamina also do not want to be whiz at home. Since 2006, Pertamina lubricant has been exporting products to several countries including China, Pakistan, Japan, Singapore, Australia, Malaysia and Cambodia with an average volume of 80,000 kl per year with an average export value of USD240 million per year. In addition to maintaining its market share above, the company also co-branded with local companies, including in Pakistan, Belgium, Qatar, Singapore, and Thailand.
Aviation fuel production of Pertamina has also been recognized internationally. Pertamina is working with airports has been supplying aviation fuel to Singapore, Jeddah, Dubai, Bangkok, Hong Kong and Kuala Lumpur. Not only that, the General Fuel Filling Station owned by Pertamina plans to expand into neighboring countries. In the near future, Pertamina will soon open the first retail outlets in Australia. As a result, various efforts to expand upstream and downstream sectors in the above led to bigger profits.
In 2006 the profits from state enterprises ranging from Rp19 trillion, then rose in 2007 to Rp24,5 billion and rise again in 2008 to Rp30,2 trillion. Based on data from Forbes Global 2009 and LKPP RI 2008, Pertamina is the state with the largest profit of Rp30,2 trillion, followed in second place with earnings of PT Telkom Indonesia Rp14 trillion. The increase in corporate profits in line with the increase in dividends paid to the state.
Performance as indicated Pertamina upstream and downstream sectors in the above shows that what Pertamina aspired to achieve world-class oil and gas company is not just a dream. Since the change of status of Pertamina into a company as stipulated in Law No. 22/2001 on Oil and Gas and followed by Government Regulation No. 31/2003 concerning Amendment to Form a company Pertamina, Pertamina is better. However, behind the various successes, Pertamina still has some homework to be completed.
Pertamina must minimize the cost recovery oil and gas production and more keen anticipation of external factors, especially international oil prices. Both of these affect to Pertamina business and profitability in the upstream sector. As is known, cost recovery resulting from Pertamina's production process is still relatively high. Pertamina's cost recovery during the period 2004-2006 an average of USD27 per barrel.
It is not particularly felt when the international oil price is constant in the range of USD100 per barrel, but it would be very detrimental if oil prices slumped. No less important, as a profit-oriented company Pertamina also have to maintain the quality in every product and services to suit customer satisfaction. For example, applying the standard dose at all filling stations, LPG cylinders to prevent the circulation of counterfeit, fake or lubricants on the market. All the above services must be considered because it deals directly with the daily life of people so of course directly affects the image of Pertamina.
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