SKK Migas Annual Report 2013

ANNUAL REPORT
2012
SKK MIGAS
ANNUAL REPORT 2012
TABLE OF CONTENTS
INTRODUCTION SKK Migas Vision and Mission Core Values SKK Migas Chairman Foreword The History of SKK Migas BPMIGAS / SKMIGAS / SKK Migas Management 2012 Annual Report Summary SKK MIGAS PERFORMANCE A. Upstream Oil and Gas Contract Area B. Exploration Activities C. Well Development & Maintenance Activities D. Oil & Gas Production Activities E. Oil & Gas Lifting F. State Revenues G. Production PSC Contractors Actual Investment H. Exploration PCS Contractors Actual Investment EFFORTS TO INCREASE PRODUCTION A. New Projects B. Improved Oil Recovery C. Reactivation of Suspended Wells D. PSC Contractors Forum for Exploration Contract Area (FOKWE) E. Cooperation with Other Institutions F. Knowledge Sharing ISSUES AND RESOLUTIONS A. Land Acquisition and Permits B. Securing National Vital Objects C. Regulations D. Oil Theft in South Sumatra DEVELOPMENT AND MAJOR PROJECTS A. Banyu Urip Field B. Indonesian Deepwater Development (IDD) C. Abadi Field D. Jangkrik & Jangkrik North East (JNE) Field E. Bukit Tua Field F. Ande Ande Lumut Field G. North Duri Development Area-13 (NDD Area-13) H. Corridor Block Development Project I. Ruby Field Development Project J. Kepodang Field K. Senoro Gas Field Integrated Development and Matindok Area L. Train 3 Tangguh Expansion Project NATIONAL CAPACITY EMPOWERMENT A. Utilization Of Domestic Goods and Services B. Optimizing Asset Management in 2012 C. Procurement Transactions Through State-Owned / Regional-Owned Banks D. National Capacity Building (NCB) Management E. Continuous Development INTERNAL SKK MIGAS A. SKK Migas Strategic Plan (Renstra) for 2011-2015 B. Configuring BPMIGAS (Now SKK Migas) Organization Structure C. ISO 9001:2008 Certification D. Internal Human Resources Management and Development E. Management and Development Of PSC Contractors Human Resources F. SKK Migas Budget Realization And Expenditure G. State Official Employee Report By SKK Migas H. Information and Communication Technologies (ICT) 2012 Oil, Gas and CBM Contract Area Map 2 3 4 6 8 14
22 26 31 33 38 42 44 45
II
49 50 52 53 56 57
III
62 65 68 70
IV
75 76 78 79 80 81 82 83 84 85 86 88
92 94 95 96 98
VI
102 103 104 106 110 112 113 114 117
APPENDIX
INTRODUCTION
SKK MIGAS VISION AND MISSION
SKK MIGAS VISION AND MISSION
VISION MISSION
Be a proactive and trustworthy partner in optimizing the benefits of the upstream oil and gas industry for all stakeholders while becoming one of the Nations engines in mobilizing different economic and industrial activities.
Supervise and control the Production Sharing Contracts implementation through partnerships in order to ensure the effectiveness and efficiency of upstream oil and gas business activities for the greatest welfare of the Nation.
SKK MIGAS
ANNUAL REPORT 2012
CORE VALUES
PROFESSIONAL: Act as a professional with strong commitment. RESPONSIVE: Promptly responding to enquiries and resolving issues. UNITY IN DIVERSITY: Synergizing the differences for greater achievements. DECISIVE: Taking calculated risk within the authority. ETHICS: Conducting business by following the highest ethical standards consistently. NATION FOCUSED: Maximizing national capacity and capability. TRUSTWORTHY: Maintaining credibility to earn the trust of stakeholders.
INTRODUCTION
SKK MIGAS CHAIRMAN FOREWORD
The transition from BPMIGAS to SKK Migas was carried out rapidly and efficiently, so as to not disrupt daily operations. Therefore, I would like to thank the Government for its prompt response towards the changes, and also to all parties involved for their unwavering support in this process.
SKK MIGAS
ANNUAL REPORT 2012
SKK MIGAS CHAIRMAN FOREWORD

Assalamualaikum Wr. Wb I would like to thank God Almighty for allowing the upstream oil and gas industry to run smoothly, despite facing a barrage of problems. The transition from BPMIGAS to SKK Migas was carried out rapidly and efficiently, so as to not disrupt daily operations. Therefore, I would like to thank the Government for its prompt response towards the changes, and also to all parties involved for their unwavering support in this process. Thanks to these efforts at the end of 2012, the upstream oil and gas sector was still able to contribute to state revenues and even exceeded the target. BPMIGAS (now SKK Migas) hand in hand with PSC Contractors managed to keep actual production and lifting closer to the set target. To boost national economic growth, we successfully maintained a high usage of local content, both goods and services. In this respect, we also gave opportunities for state-owned companies to be involved in the upstream oil and gas industry. We also continue to develop the role of the national banking industry through the utilization of national banks in the upstream oil and gas industry. No less important is our efforts to increase gas allocation to meet domestic consumption thus producing a chain reaction towards the economy. Nevertheless, we still have plenty of work to do which require extra efforts, especially if we are to increase production in the short-term, mid-term, and long-term. SKK Migas performance in 2012 and previous years showed that we couldnt succeed without the aid of the Nation. This annual report is our way to show responsibility for all the support and trust given. We hope that in future years, our stakeholders will give us even more support in realizing the oil and gas industry, so as to generate maximum benefits for the Nation. Wassalamualaikum Wr. Wb
Rudi Rubiandini R.S.
INTRODUCTION
THE HISTORY OF SKK MIGAS
THE HISTORY OF SKK MIGAS

BPMIGAS was the first to comply and obey the Constitutional Court Decision Number 36/PUU-X/2012.
On November 13th, 2012, the Constitutional Court rendered Decision Number 36/PUU-X/2012 which declared that phrases related to Badan Pelaksana Kegiatan Usaha Hulu Minyak dan Gas Bumi (BPMIGAS) stated in Law Number 22 of 2001 on Oil and Gas to be in contradiction with the 1945 Constitution and does not have any binding power. The implication of this decision is the transfer of BPMIGAS role to the Government cq. related Ministry. BPMIGAS as a government agency that has supervised and controlled the upstream oil and gas business activities for the past decade was the first to comply and obey with the Constitutional Court Decision. As soon as the decision was announced, BPMIGAS management instructed its employees to immediately stop all works related to the duties and functions of said agency. As a form of compliance, BPMIGAS also disabled its employees external email and website, which was used to communicate with the public. At the same time, the Government acted swiftly to ensure upstream petroleum operations was not disturbed by the Constitutional Court Decision. President Susilo Bambang Yudhoyono issued Presidential Regulation Number 95 of 2012 on The Transfer of Duties and Functions of the Upstream Oil and Gas Activity Agency. Inline with the Constitutional Court Decision to transfer the functions and duties of BPMIGAS to the related Minister, the Presidential Regulation reiterated that the duties, function and organization of BPMIGAS are transferred to the Minister of Energy and Mineral Resources (EMR). The Presidential Regulation also states that the Minister of EMR shall continue all processes conducted by BPMIGAS. BPMIGAS duties, such as approval of work program and budget (WP&B), plan of development (POD), authorization for expenditure (AFE), and permits, supervision and any ongoing implementation shall be continued based on the Presidential Regulation. As a consequence of Presidential Regulation Number 95 of 2012, the Minister of EMR also issued Decree Number 3135K/08/MEM/2012 and Number 3136K/73/MEM/2012 on November 13th, 2012. With the issuance of Minister of EMR Decree Number 3135K/08/MEM/2012 BPMIGAS duties, functions, and organizational structure were transferred to Satuan Kerja Sementara Pelaksana Kegiatan Usaha Hulu Minyak dan Gas Bumi (SKMIGAS), a unit under and supervised by the Minister of EMR.
SKK MIGAS
ANNUAL REPORT 2012
Despite facing a number of challenges in 2012, the upstream oil and gas industry was able to fully contribute to the State.
Whereas, Minister of EMR Decree Number 3136K/73/MEM/2012 transferred BPMIGAS management and employee to SKMIGAS and instructed that all management and employee to carry out their duties. With the intent to give legal certainty to investors, on January 14th, 2013, through Presidential Regulation Number 9 of 2013 on Management of Upstream Oil and Gas Activities, Satuan Kerja Khusus Pelaksana Kegiatan Usaha Hulu Minyak dan Gas Bumi (SKK Migas) was established to manage the upstream oil and gas activities until a new law on oil and gas is passed. With this, SKMIGAS duties and responsibilities are transferred to SKK Migas. To control, supervise, and evaluate SKK Migas management of upstream oil and gas business activities, Presidential Regulation Number 9 of 2013 also created an Oversight Committee. This committee consists of a Chairman (Minister of EMR), Vice Chairman (Deputy Minister of Finance) and 2 members (Indonesia Investment Coordinating Board Chairman and Vice Minister of EMR). Based on this history, SKK Migas performance in this annual report also compromises the performance of BPMIGAS and SKMIGAS in managing the upstream oil and gas industry on behalf of the Government. The performance of the upstream oil and gas industry in 2012 is based on the contribution of all stakeholders to uphold its responsibility to the Nation and the State. This achievement is the result of stakeholders maximum effort in the face of various challenges in the upstream oil and gas industry, both technical and non-technical. Despite facing a number of challenges in 2012, the upstream oil and gas industry was able to fully contribute to the State through several accomplishments such as maximizing Government Take and exceeding the target set in 2012 APBN-P; increasing allocation of domestic gas and thus creating a chain reaction towards the national economy; increasing national capacity; and also maintaining the national energy security.
INTRODUCTION
BPMIGAS / SKMIGAS / SKK MIGAS MANAGEMENT
SKK MIGAS MANAGEMENT (JANUARY 14th, 2013-PRESENT)
SKK MIGAS CHAIRMAN Rudi Rubiandini R.S. was inaugurated as SKK Migas Chairman on January 16th, 2013 having previously held the office of Vice Minister of EMR since June 14th, 2012. The name Rudi Rubiandini is well known within the upstream oil and gas industry. Earning his Doktor Ingenieurs (Dr.-Ing) degree specializing in petroleum engineering from the Technische Universitaet Clausthal, Germany, Rudi formerly served as BPMIGAS Deputy for Operation Management as well as Corporate Secretary for the same agency. Before joining BPMIGAS, Rudi was a known consultant for various oil and gas field development projects, a trainer of different technical courses in the oil and gas industry, and as a source for a variety of seminars. He has also developed numerous upstream petroleum engineering softwares and is an author of several books. This Petroleum Engineering Faculty of the Bandung Institute of Technology (ITB) alumnus is also actively involved in assisting the Government, among others as the Deputy Chairman for the Supervisory Team of Oil and Gas Production Enhancement (TP3M), Ministry of EMR and as the Deputy Chairman for Investigation Team of Oil and Gas Accidents. Born in Tasikmalaya on February 9th, 1962, Rudi also has extensive field experiences among others in handling blowout incidents in several oil and gas fields in Indonesia.
SKK MIGAS VICE CHAIRMAN Johanes Widjonarko was inaugurated as SKK Migas Vice Chairman on February 8th, 2013. He initially served as BPMIGAS Vice Chairman (2012) and Deputy for General Affairs in the same agency (2011). Born in September 28th, 1962, Widjonarko graduated from the geological engineering department, National Development University (UPN), Yogyakarta, in 1988. He then obtained a Masters Degree in Business Policy Administration Science from the University of Indonesia (UI). Widjonarko began his career by working as a government official at the Directorate General of Oil and Gas, Ministry of EMR, since 1991. During his work at the Directorate General of Oil and Gas, Widjonarko was actively involved as a member in teams formulating and preparing various regulation concepts, including Law Number 22 of 2001 on Oil and Gas, Government Regulation Number 35 of 2004 on Upstream Oil and Gas Activities, and Law Number 79 of 2010 on Recoverable Operational Costs and Income Tax in the Upstream Oil and Gas Industries. He was also involved for more than seven years in drafting concepts for cooperation contracts and the offering of new oil and gas working areas. In addition, Widjonarko was responsible for the formulation of government policies in the oil and gas sub sector. Included in these policies were: The Energy and Mineral Resources Ministers Regulation Number 03 of 2010 on Natural Gas Allocation; Master plan for the National Gas Distribution and Transmission Network; oil and gas infrastructure policy; strategic reserves concept; and the National Gas Blueprint Concept. In 2011, Widjonarko was also appointed as Head of the EMR Technical Team to formulate the Master Plan for Acceleration and Expansion of Indonesian Economic Development (MP3EI) in 2011-2025.
SKK MIGAS
ANNUAL REPORT 2012
SKK MIGAS SECRETARY Gde Pradnyana was inaugurated as SKK Migas Corporate Secretary on February 8th, 2013 following the office of BPMIGAS Deputy for Operations Management. In November 19th, 2002, Gde resigned from being a lecturer in ITB and joined BPMIGAS as Head of the Operation Facilities and Construction Division and before joining the ranks of management, Gde was Head of Public Relations, Security and Formalities Division at the same agency. Born in Klungkung, Bali, on April 28th, 1960, Gde earned a degree in Civil Engineering from ITB in 1984. He received his master degree in Ocean Engineering from University College London and subsequently his Doctor of Philosophy in the same field from the University of Oxford, UK in 1992. Gde is an alumnus of the National Resilience Institute (LEMHANNAS). He has more than 25 years of experience in upstream oil and gas industry and during that period he was involved in various major projects, including the West Seno TLP; the Tangguh LNG Plant; as well as the Kerisi Hiu and the North Belut Platforms.
SKK MIGAS CHIEF EXECUTIVE AUDIT Priyo Widodo was inaugurated as SKK Migas Chief Executive Audit on February 8th, 2013. Born in Yogyakarta on March 19th, 1960, Priyo received his undergraduate degree in Accounting from Gajah Mada University (UGM) in 1985 and his postgraduate degree in Management from the UI in 1994, and for more than 25 years he has dedicated his services to the financial controls aspect of the upstream oil and gas industry. Early in his carrier, Priyo worked for Pertamina with his last position as Government Take Audit Manager in the Directorate of Production Sharing Management (Dit. MPS). Priyo then continued his carrier in BPMIGAS from 2003 up to 2012. In this institution, Priyo occupied several offices, among others, as the Head of Financial Management Division; Head of Work Program and Budget Management Division; and Vice President Management Representative of Pertamina EP for Eastern Area.
SKK MIGAS DEPUTY FOR PLANNING MANAGEMENT Aussie B. Gautama was inaugurated as SKK Migas Deputy for Planning Management on February 8th, 2013 following the office of BPMIGAS expert staff for exploration and reserves concept. Born in Canberra on August 22nd, 1955, Aussie graduated from ITBs Geological Engineering Study Program and has more than thirty years experience as a geologist. Since 1982 to September 2012, Aussie worked for Total E&P Indonesie with his last position as Vice President Geosciences & Reservoir. While working for Total E&P Indonesie, Aussie was involved in several national and international field development projects, among others, as a geologist for the Elmworth Project in Canada; as a senior geologist for the Tunu Field in East Kalimantan; and as head 3G studies for the Egina Project in Preowei, Nigeria.
INTRODUCTION
SKK MIGAS DEPUTY FOR OPERATIONS MANAGEMENT Muliawan was inaugurated as SKK Migas Deputy for Operations Management on February 8th, 2013. Born in Jakarta on February 20 th, 1962, Muliawan received his undergraduate degree in exploration mining engineering from ITB and his postgraduate degree from UGM. Muliawan has extensive experience in upstream oil and gas operation activities, either during his term of office in Pertamina or during his service in BPMIGAS. Several positions were occupied by Muliawan in BPMIGAS, among others are Head of Production Operations Division and Head of BPMIGAS Representative Office. Muliawan has also attended numerous technical trainings related to the operations of upstream oil and gas industry conducted either in the country or abroad.
SKK MIGAS DEPUTY FOR FINANCIAL MANAGEMENT Akhmad Syakhroza was inaugurated as SKK Migas Deputy for Financial Management on February 8th, 2013. Born in Bengkulu on November 30 th, 1963, Syakhroza graduated as an accounting major from the Faculty of Economy, UI in 1987. He pursued a Masters Degree in Accounting, Finance, and Information System at Cleveland State University, Ohio, United States, and graduated in 1991. He obtained a doctoral degree in Organization Behavior and Management Accounting from the Faculty of Business and Public Management, Edith Cowan University, Perth, Australia, in 2001. Apart from being a lecturer at the Faculty of Economy, University of Indonesia, Syakhroza was also active as an auditor, consultant, and audit committee member at several private companies.
SKK MIGAS DEPUTY FOR COMMERCIAL MANAGEMENT Widhyawan Prawiraatmadja was inaugurated as SKK Migas Deputy for Commercial Management on February 8th, 2013. Born in Bandung on August 4th, 1960, Widhyawan earned his bachelor degree in Industrial Engineering from ITB in 1987. He continued his study and earned a Ph.D. in economics from the University of Hawaii in 2002. Working for the energy sector for more than 25 years, Widhyawan has held various executive positions both in national and multinational companies, among others, as Country Executive for GE Energy Indonesia.
SKK MIGAS DEPUTY FOR BUSINESS SUPPORT MANAGEMENT Gerhard M. Rumeser was inaugurated as SKK Migas Deputy for Business Support Management in February 8th, 2013. Born on March 22, 1956, in Magelang, Gerhard earned his bachelor degree in Mechanical Engineering from ITB in 1984. He pursued a Masters degree in Human Resource Management at Rutgers State University, USA, and earned his degree in 1999. Working in the upstream oil and gas industry for more than 20 years, Gerhard has wide experiences in human resource management, among others, as Country HR Manager at BP Indonesia, and has held numerous positions in BPMIGAS, among others, as Head of Procurement and Assets Division, Head of Human Resources and General Affairs Division, and as Deputy for General Affairs.
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SKK MIGAS
ANNUAL REPORT 2012
SKMIGAS MANAGEMENT
(NOVEMBER 13th, 2012 - JANUARY 14th, 2013)
MINISTER OF ERM AS SKMIGAS CHAIRMAN Ir. Jero Wacik, S.E. was inaugurated as Minister of Energy and Mineral Resources on October 18th, 2011 having previously held the office of Minister of Culture and Tourism since October 21st, 2004. With the founding of SKMIGAS through Presidential Regulation Number 95 of 2012, Jero concurrently held the office of Chairman of SKMIGAS up to the establishment of SKK Migas based on Presidential Regulation Number 9 of 2013. Born in Singaraja, Bali on April 24th, 1949, Jero earned his bachelor degree in Mechanical Engineering from ITB in 1974 and his bachelor degree in Economics from UI in 1983.
SKMIGAS VICE CHAIRMAN Johanes Widjonarko SKMIGAS DEPUTY FOR PLANNING Widhyawan Prawiraatmadja SKMIGAS DEPUTY FOR FINANCIAL MANAGEMENT Akhmad Syakhroza SKMIGAS DEPUTY FOR OPERATION MANAGEMENT Gde Pradnyana SKMIGAS DEPUTY FOR GENERAL AFFAIRS Gerhard M. Rumeser
SKMIGAS DEPUTY FOR EVALUATION AND LEGAL ADVISORY Lambok H. Hutauruk held the office of BPMIGAS and later SKMIGAS Deputy for Legal Evaluation and Consideration from October 9th, 2009 until February 7th, 2013. Having previously held the office of Director of Gratification in the Corruption Eradication Commission (KPK). Born in Tebing Tinggi, Sumatera on July 3rd, 1954, Lambok received his Bachelor Degree in Civil Engineering from the Technical University Darmstadt, Germany in 1983. In 1984, he received his Master Degree in Construction Management from the Technical University Braunschweig, Germany.
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INTRODUCTION
BPMIGAS MANAGEMENT (UNTIL NOVEMBER 13th, 2012)
BPMIGAS CHAIRMAN R. Priyono held the office of BPMIGAS Chairman from April 29th, 2008 until November 13th, 2012. Born in Pati, Central Java on September 12th, 1956, R. Priyono received his Bachelor Degree in Geology from ITB in 1769. R. Priyono started his career at the Directorate General of Oil and Gas, Ministry of EMR. Before becoming BPMIGAS Chairman, he held the office of Director of Oil and Gas Upstream Business Development, Directorate General of Oil and Gas, Ministry of EMR. As Chairman of BPMIGAS, R. Priyonos vision was to increase production by controlling cost recovery and simplifying bureaucracy.
BPMIGAS VICE CHAIRMAN Johanes Widjonarko BPMIGAS DEPUTY FOR PLANNING Widhyawan Prawiraatmadja BPMIGAS DEPUTY FOR FINANCIAL MANAGEMENT Akhmad Syakhroza BPMIGAS DEPUTY FOR OPERATION MANAGEMENT Gde Pradnyana BPMIGAS DEPUTY FOR GENERAL AFFAIRS Gerhard M. Rumeser BPMIGAS DEPUTY FOR EVALUATION AND LEGAL ADVISORY Lambok H. Hutauruk
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ANNUAL REPORT 2012
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INTRODUCTION
2012 ANNUAL REPORT SUMMARY
The realization of investment in the upstream oil and gas sector continually rises from year to year. In 2012, investments reached US$16.1 billion, which is a US$14 billion increase (115%) from last year.
A number of upstream oil and gas achievements in 2012 have strategic significance for the nation. The summary is as follows: MAXIMIZING INDONESIAS INCOME: Successfully contributed US$34.9 billion to state revenues or 104% of the target stated in the Indonesian Revised Budget (APBN-P) of US$33.48 billion. State revenues derived from the sales of petroleum are 58% of gross revenue.
Increased the average gas price by 28.76% from the 2012 APBN-P target of
US$8.23 per million British Thermal Unit (MMBTU) to US$10.59 per MMBTU through renegotiation of domestic gas price and transfer of LNG Tangguh Papua sales. This has become a significant factor under the control of the Government which contributes in exceeding the targeted state revenues, in addition to the Indonesian Crude Price (ICP) which reached US$113 per barrel.
Produced 860 thousand barrel oil per day (MBOPD) of crude oil from the 2012
APBN-P target of 930 MBOPD (92.47%). This is 98% of the 2012 revised work program and budget (WP&B) of 878.5 MBOPD. While gas production reached 8,150 million standard cubic feet per day (MMSCFD).
The realization of investment in the upstream oil and gas sector continually rises from
year to year. In 2012, investments reached US$16.1 billion, which is a US$14 billion increase (115%) from last year. In 2012, investments in the upstream oil and gas sector used for exploration activities amounted to US$1.4 billion, while production and development activities reached US$13.7 billion, and administration activities amounted to US$1 billion.
In 2012 the Directorate General of Oil and Gas, Ministry of EMR signed 25 new
cooperation contracts in the form of Production Sharing Contracts (PSC). Making the number of contracts under the supervision of SKMIGAS (now SKK Migas) at the end of 2012 a total of 308 cooperation contracts, which consists of 75 production PSCs, 179 exploration PSCs and 54 CBM PSCs.
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ANNUAL REPORT 2012
It is the commitment of this agency to maintain domestic energy supply to increase sustainability resulting in a chain reaction that will affect national industry and economy.
ENERGY FOR THE NATION: It is the commitment of this agency to maintain domestic energy supply to increase sustainability resulting in a chain reaction that will affect national industry and economy. The volume of domestic natural gas in 2012 reached 3.4 billion BTU per day, which is a 262% increase from 2002 which was under 1.3 billion BTU per day.
This agency also aims to maximize oil supplies so as to maintain national energy
sustainability. 65% of oil production is allocated for the needs of domestic refineries, while the rest of the production is exported. This is due to the fact that part of the production belongs to the PSC Contractors, not to mention the limited capacity of domestic refineries and also as a strategy to determine ICP needed in calculating the LNG price.
To support the Governments program in reducing the consumption of subsidized fuel,

we have allocated gas for transportation needs; however this program has not been fully realized due to inadequacy of infrastructure.
15
INTRODUCTION
By increasing BPMIGAS (now SKK Migas) organizational abilities, we were able to accelerate the POD approval process.
EFFICIENCY: To implement the Indonesia Incorporated concept, we continually improve joint procurement of goods and services by PSC Contractors. In 2012, this activity has generated savings of US$147.96 million, higher than the target of US$125 million, with a total savings of US$355.6 million since this program was launched in 2008.
Utilization of shared assets has increased from 2009 to 2012. In 2012, this activity
has generated savings of US$43 million, higher than the target of US$30 million, with a total savings of US$148 million since 2009.
This agency has conducted a bureaucracy reform to accelerate approval processes.

One of these reforms can be seen by the acceleration of the POD approval process. By increasing BPMIGAS (now SKK Migas) organizational abilities, we were able to accelerate the POD approval process from 47 days in 2006-2007 to 28 days since 2010 dan approval of WP&B before the start of the new fiscal year since 2010.
Based on Law Number 22 of 2001 on Oil and Gas, this agency is entitled to 1% of
the total oil and gas revenues for its operating costs. The average approved budget from year to year is 0.3%, as is for 2012. For the past 10 years this agency has attempted to economize its operation and by 2012 has returned US$1.8 billion of its budget to the state treasury.
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ANNUAL REPORT 2012
This agency continues to sustain national interest by upholding procurement policies.
UPHOLDS NATIONAL INTEREST : This agency continues to uphold national interest by implementing procurement policies needed to maintain upstream oil and gas activities, such as through Standard Operating Procedure Number 007 REVISI-II/PTK/2011 on PSC Contractors Supply Chain Management. Such guidelines give preferences to domestic providers of goods and services and require PSC Contractors to necessitate a minimum level of local content (Tingkat Komponen Dalam Negeri / TKDN) in their procurement process.
To increase national and regional banking capacities (State-Owned and

Regional-Owned Banks), this agency is committed to using State-Owned and Regional-Owned Banks. In 2012, the total transaction for procurement of goods and services using State-Owned and Regional-Owned Banks reached US$9 billion. Based on this, the total transaction for procurement of goods and services using State-Owned and Regional-Owned Banks from April 2009 until 2012 is US$24.28 billion.
Procurement commitments in 2012 reached US$16.61 billion with a 60.04% local

content (cost basis).
Local content also involves the participation of state-owned goods and services
suppliers. Since 2010 up to 2012, the total amount of procurements was US$2.1 billion with an average local content of 74.26%. SKK Migas hopes that state-owned companys participation can be improved in the future so as to maximize the upstream oil and gas industries multiplier effect.
17
INTRODUCTION
By increasing the budget for social responsibility in the oil and gas industry from year to year, we confirm our commitment to the community.
SOCIAL RESPONSIBILITY: By increasing the budget for social responsibility in the oil and gas industry, we confirm our commitment to the community. In 2012, the budget realization for activities related to social responsibility reached Rp305 billion, a 171% increase from 2011 realization of Rp178 billion.
Some of the activities were for education aid and community assistance. As a form of social concern, we also gave rapid aid to the victims of natural disasters,
such as the earthquake in Yogyakarta, the earthquake in Nias, the earthquake in Padang, the landslide and flood in Wasior, as well as the flood in Jakarta.
INCREASING OIL AND GAS RESERVES:
SKK Migas improved its coordination with central and local Government institutions
to facilitate PSC Contractors exploration permits needed to increase oil and gas reserves. In 2012, we drilled 96 exploration wells, which is an increase from last years accomplishment of 83 exploration wells.
The percentage of successful wildcat exploration wells (with flow test) is 45% or
higher than the world average of 40%, with a discovery of 987 million barrels of oil equivalent (MMBOE) in reserves. Exploration activities in 2012 are primarily offshore with higher risks.
Considering the high risk of upstream oil and gas activities, the cooperation contract
system is designed to protect the interest of the State. Thus by applying said system the costs of failed exploration activities are not born by the State. The data indicates that from 750 exploration wells drilled in 2002 up to 2012, the amount of dry holes reached 328 wells or almost 50%, and all costs associated with the dry holes are born by the investors.
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ANNUAL REPORT 2012
To increase national oil and gas production we are developing new oil and gas fields.
MAIN PROJECTS: To increase national oil and gas production we are developing new oil and gas fields through several major projects, which are:
Banyu Urip Mobil Cepu Ltd; Indonesia Deepwater Development (IDD) Chevron Indonesia Company; Abadi INPEX Masela Ltd.; Jangkrik and Jangkrik North East (JNE) eni Muara Bakau B.V.; Bukit Tua PC Ketapang II Ltd.; Ande-Ande Lumut AWE (Northwest Natuna) Pte. Ltd.; North Duri Development 13 (NDD-13) PT Chevron Pacific Indonesia; Corridor ConocoPhillips Grissik Ltd.; Ruby PearlOil (Sebuku) Ltd.; Kepodang PC Muriah Ltd.; Donggi Senoro JOB Pertamina-Medco Tomori; Tangguh Train 3 BP Berau Ltd.
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ANNUAL REPORT 2012
SKK MIGAS PERFORMANCE
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I. SKK MIGAS PERFORMANCE
A. UPSTREAM OIL AND GAS CONTRACT AREA
A.
New Contract Area
UPSTREAM OIL AND GAS CONTRACT AREA

One of the ways that the Government of Indonesia increases reserves and production of oil and gas is by extensification (i.e. increasing the number of new contract areas). Throughout 2012 the Directorate General of Oil and Gas made 3 procurement announcements for new contract areas, which was followed by the signing of Cooperation Contracts in the form of Production Sharing Contracts in April, July and October. From those activities, the Government of Indonesia was able to add 13 oil and gas contract areas and 12 coal bed methane (CBM) contract areas. At the same time, the Government approved the total relinquishment of 4 contract areas by PSC Contractors, which are Asmat contract area, Bengara-II contract area, Halmahera contract area and Rembang contract area. Furthermore there are 18 contract areas in the process of total relinquishment. Said contract areas are relinquished because until the end of the exploration period the respective PSC Contractors could not fulfill their firm commitment or could not find producible reserves.
From those endeavors, at the end 2012 there were 308 contract areas (CA) as follows:
Total Contract Area in 2012
TOTAL
PRODUCTION
CBM
EXPLORATION TERMINATION
ONSHORE 142 CA 36 CA 52 CA 53 CA 1 CA OFFSHORE ONSHORE/ OFFSHORE 112 CA 54 CA 24 CA 15 CA 0 CA 2 CA 74 CA 34 CA 14 CA 3 CA
One of the ways the Government of Indonesia increases reserves and production of oil and gas is by extensification (i.e. increasing the number of new contract areas).
CBM CA 54 CA
ACTIVE OIL & GAS CA 161 CA
TERMINATION PROCESS 18 CA
PRODUCTION EXPLORATION CA CA 75 CA 233 CA
TOTAL CONTRACT AREA 308 CA
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ANNUAL REPORT 2012
Through 2012, the Government successfully added 13 oil and gas contract areas and 12 CBM contract areas. The Government also approved the total relinquishment of 4 contract areas from PSC Contractors, so that at the end of 2012 there are a total of 308 contract areas.
Yearly breakdown of CBM, production and exploration contract area.
350 308 300 287 54
250
245 23
42
200 179 172 150 155
Total CA Production CA
Total Contract Area
CBM CA Exploration CA
100
50
67
73
75
0 2010 2011 2012
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A. UPSTREAM OIL AND GAS CONTRACT AREA
Exploration Contract Area
At the end of 2012, there are 233 exploration contract areas consisting of 54 CBM contract areas, 161 oil and gas contract areas, and 18 contract areas in the process of total relinquishment. 119 contract areas has entered the firm commitment evaluation phase, bearing in mind those contracts signed in 2003-2009 has passed the initial 3-year exploration phase. Out of the 119 exploration contract areas, 42 contract areas were able to fulfill its firm commitment, 59 contract areas were not able to fulfill its firm commitment, and 18 contract areas are nominated for total relinquishment.
15% 35%
42 (35%)
ABLE TO FULFILL THEIR FIRM COMMITMENT
59 (50%)
NOT ABLE TO FULFIL THEIR FIRM COMMITMENT
18 (15%)
TERMINATION PROCESS
50%
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SKK MIGAS
ANNUAL REPORT 2012
There are 233 exploration contract areas consisting of 54 CBM contract areas, 161 oil and gas contract areas, and 18 contract areas in the process of total relinquishment.
Evaluation results shows that fulfillment of firm commitment faces many challenges in the field. The major challenges are external issues (47%), which consist of social issues, permits, and overlapping of land ownership. Other challenges are internal PSC Contractor issues (24%) (operatorship, financial, priority holding, etc.), availability of equipments and operational support services (21%), and subsurface complexity issues (8%).
Challenges in Fulfilling Firm Commitment
8%
47%
EXTERNAL
24% 47%
21%
EQUIPMENT
24%
INTERNAL
21%
8%
SUBSURFACE COMPLEXITY
Production Contract Area
In 2012, 2 contract areas entered into the production phase by obtaining Plan of Development approval from the Minister of EMR, which are Tonga contract area and Palmerah contract area. With the addition of those contract areas, the total production contract area has reached 75 contract areas, with 60 producing contract areas and 15 contract areas in the development phase. Based on the first POD, those 2 contract areas will contribute approximately 1,500 BOPD in 2013.
25
B. EXPLORATION ACTIVITIES
B.
G&G and TSA Studies for Exploration Activities
EXPLORATION ACTIVITIES
Regarding intensification efforts to increase oil and gas reserves, SKK Migas encourages PSC Contractors to conduct exploration activities, both in exploration contract areas and in production contract areas. The activities conducted in this phase consists of geological & geophysical studies (G&G), geophysical studies (2D seismic and 3D seismic survey), exploration drilling, coring, and production test. For CBM contract areas, the exploration activities also include CBM drilling (exploration & core hole) and dewatering.
In 2012, 241 PSC Contractors have conducted a total of 460 G&G and technical services from abroad (TSA) studies, consisting of 377 domestic studies, 46 TSA studies and 37 in-house studies. The total budget for exploration G&G and TSA studies in 2012 is US$91.47 million, with 310 studies using new authorization for expenditure (AFE) and 113 studies carried over from last year.
Seismic Survey
In 2012, PSC Contractors conducted 27 activities of 2D seismic surveys (13,995 km) and 19 activities of 3D seismic survey (6,615 km2).
2D and 3D Seismic Surveys in 2007-2012
35,000 31,656 30,000 25,427 25,000
33,906
15,000
2D Seismic Survey
10,000
13,550 11,775 8,990 6,997 5,000 KM/KM2 4,776
12,549 8,147
13,995
6,165
3D Seismic Survey
0 2007 2008 2009 2010 2011 2012
26
SKK MIGAS
ANNUAL REPORT 2012
Exploration Drilling (Conventional)

Exploration Drilling
In 2012, there were 96 (conventional) exploration wells drilled, consisting of 55 onshore wells and 41 offshore wells.
100 41 80 42 60 30 26 22 38 32 24 37 50 43 26 16 54 11 61 54 59 55 22
24
Offshore
Wells
40
Onshore
20
33
0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
From the 96 exploration wells drilled, 60 wells are defined as wildcat wells with 27 discovered hydrocarbons consisting of 9 oil & gas discovery wells, 13 gas discovery wells and 5 oil discovery wells. The remaining 36 wells are defined as delineation wells. The success ratio for wildcat exploration wells (with flow test) is 45% or higher than the world average of 40%, with a discovery of contigent resources of 987 MMBOE.
Wildcat Discovery in 2012
1200 1000 800 600
27 23 19 24
27
987
30 25 20 15
Resources Discovery
400 200
154 235
508 361
10 5 0 Wells Percentage
MMBOE
0 2008 2009 2010 2011 2012*
Exploration Wells Success Ratio (Wildcat, with flow test) Success Ratio
WELLS
100 57% 80 35% 51% 47% 45% 60 51
60% 50% 40% 30% 20% 10% 0 2008 2009 2010 2011 2012* 27
Wildcat
60 47 40 45 27 20 27
54
Discovery
23
19
24
27
* December 31st, 2012 status awaiting final recapitulation
CBM Drilling
In 2012, 3 PSC Contractors were able to meet their firm commitment, which are Newton Energy Capital Ltd (GMB Kutai contract area operator), Vico CBM Indonesia (GMB Sanga-Sanga contract area operator), and PT Medco CBM Sekayu (GMB Sekayu contract area operator). The activities conducted in CBM contract areas in 2012 consists of 16 corehole drillings, 14 exploration drilling, 22 G&G studies and 10 dewatering-production tests.
GMB and Pilot Drilling Activities
16 13 13 14
Corehole Exploratory Dewatering Production test
9 6
10
Wells
0 2010 2011 2012
Wells
SKK Migas encourages PSC Contractors to conduct exploration activities compromising of geological & geophysical studies (G&G), geophysical surveys (2D seismic and 3D seismic survey), exploration drilling, coring, and production test.
40
G&G Study Activities

33 30
20 9 3 0 2009 2010
12
2011
2012
Daily production from dewatering / production test wells is +0.98 MMSCFD, derived from 8 wells in 3 CBM contract areas, which are GMB Sekayu contract area, GMB Sanga-Sanga contract area, and GMB Muara Enim contract area.
1.2
GMB Production Test 2010-2012
0.98 1 0.8 0.6

Total CBM in MMSFD
3 CA 8 WELLS
0.4 0.2 0 0 2010
2 CA 2 WELLS 0.27
2011
2012*
28
SKK MIGAS
ANNUAL REPORT 2012
Determining the Exploration Status
Determining the Exploration Status (Penentuan Status Eksplorasi / PSE) is the transition process from exploration to production. In 2012 we achieved 40 PSE to develop exploration findings of 599 MMBOE, which will be further evaluated for POD submission.
1,000 40
50
800
40
600
27
27 522
599 30 20
Exploration Discovery PSE

* December 31 , 2012 status awaiting final recapitulation
st
400 277
0 2010 2011 2012*
29
Total PSE
200
MMBOE
10
Oil and Gas Resources and Reserves
The estimation of volumetric resources (January 1st, 2012) conservative P50 original oil in-place (OOIP) is 64.6 BSTB (oil case) and P50 original gas in-place (OGIP) is 197.4 TSCF (gas case). Until January 1st, 2012, there are 2,465 identified structures, consisting of 1,211 structures that have conducted lead surveys, 1,166 prospects that are ready to drill, 38 postdrill prospects with indications of hydrocarbon without production tests, and 50 prospects with hydrocarbon discoveries.
Reserve Replacement Ratio (RRR) for crude oil in 2012 is 52%, while for natural gas is 127%.
Based on the approved PODs in 2012, generated additional reserves are 162.73 MMSTB oil and 3.78 TSCF gas. In 2012 oil and gas production reached 314.67 MMTSB for oil and 2.97 TSCF for gas so that the estimated oil and gas reserves per January 1st, 2013 is as follows:
PROVEN POTENTIAL PROVEN + POTENTIAL OIL & CONDENSATES (MMSTB) ASSO. + NON. ASSO. GAS (TSCF)
3,590.58 104.37
3,671.64 48.38
7,262.22 152.75
Reserve Replacement Ratio (RRR) for oil in 2012 is 52%, while for gas is 127%. This means for every barrel of oil produced it will be replaced by 0.52 barrels of oil found. While for every TSCF gas produced it will be replaced by 1.27 TSCF gas found. Whereas the withdrawal rate (WR) of oil is 8.41% and gas is 2.87%.
30
SKK MIGAS
ANNUAL REPORT 2012
C.
G&G & TSA Studies for Production Activities Plan of Development (POD)
WELL DEVELOPMENT & MAINTENANCE ACTIVITIES

In 2012, PSC Contractors have conducted a total of 156 geological, geophysical and reservoirs (GGR) and production TSA studies, consisting of 136 domestic studies, 15 TSA (project) studies and 5 TSA (QC) studies. The total budget for GGR and TSA studies in 2012 is US$36.4 million, consisting of US$29.1 million for GGR studies, US$6.59 million for TSA (project), and US$731 thousand for TSA (QC).
In 2012, there were 47 plan of developments (POD) consisting of 9 PODs, 3 improved oil recoveries (IOR) POD, 2 first PODs, 15 plan of further developments (POFD), 16 put on production (POP), and 2 POD revisions. PSC Contractors estimation costs for investment and operation, oil and gas productions, and government income from those 47 PODs are:
Cumulative Production
OIL (MILLION BBL)
GAS (BSCF)
LPG (MILLION BBL)
GOVERNMENT TAKE (MILLION US$)
162.73
Operation & Investment Costs
3,788.49
7.45
18,943.8
INVESTMENT COST (MILLION US$)
OPERATING COST (MILLION US$)
6,997.2
OPERATING COST (MILLION US$) ASR COST (MILLION US$)
TOTAL INVESTMENT & ) OPERATING COST (MILLION US$)
14,319
6,550.2
447
21,316.2
31
C. WELL DEVELOPMENT & MAINTENANCE ACTIVITIES
Production Drilling Activities (Development Well) and Workover Well
SKK Migas encourages PSC Contractors to drill additional wells (infill wells) and conduct workovers, in order to withhold the decline in production. In 2012, 840 production wells were drilled out of the 907 wells planned. This was due to several constraints such as land acquisition, permit processes, and rig availability.
Development Drilling in 2004-2012
1,400 1,200 1,000 800 600 442 400 200 Wells 0 2004 2005 2006 2007 2008 563 614 749 985
1,219
951
953 840
2009
2010
2011
2012
Left Table: Development Drilling
1,000 900 800 700 600 836
953
907
840
WP&B Revision Realization
1,000 900 800 700 600 500 400 300 200 Wells 100 0 2011 2012 700 704 871 740
Right Table: Workover
500 400 300 200 Wells 100 0 2011 2012
740 wells or 85% of the 871 wells planned were maintained through workover. This is due to priority usage of workover rigs and several constraints such as Hinder Ordonnantie (HO) permits, explosives permits, and procurement of workover rigs. Thus affecting the execution of planned activities in 2012. Of the 13,179 well service activities planned, 11,323 activities or 82.5% have been conducted.
32
SKK MIGAS
ANNUAL REPORT 2012
D.
Production of Oil, Condensate and Gas
2,636.46
2,750 2,500 2,250 2,000 1,750 1,500 1,250 1.,000 750 500
OIL & GAS PRODUCTION ACTIVITIES

In 2012, the average production of oil and gas reached 2.31 million barrels of oil equivalent per day (MMBOEPD). Based on the production data, in 2007-2010 oil production increased year to year, however in 2012 a decline occurred, caused by a drop in production from Total E&P Indonesie, ExxonMobil Oil Indonesia Inc., and PT. Chevron Pacific Indonesia.
OIL
2,587.63 2,521.94
CONDENSATES
GAS
2,572.72
2,464.46
2,459.02
2,526.49 2,373.85 2,254.89 2,308.91 2,370.57
2,404.76
2,315.18
1,272.90
1,208.78
1,119.90
1,012.86
966.77
935.09
883.25
836.01
852.63
826.47
824.45
794.30
762.82
120.45 132,21 142.40 132.65 133.72 129.16 127.03 122.74 118.39 124.15 122.33
107.80
97.09
1,160.42
1,123.03
1,384.35
1,441.05
1,426.01
1,396.90
1,367.86
1,300.49
1,332.13
1,421.77
1,581.59
1,502.66
1,455.27
MBOEPD
250 -
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Gas production = 45% to 64% of oil, condensate and gas production Oil production = 49% to 32% of oil, condensate and gas production Condensate production = 6% to 4% of oil, condensate and gas production; 12% to 8% of gas production.
Oil and Condensate
Oil and condensate production in 2012 reached 860 MBOPD or 92.5% of the APBN-P target of 930 MBOPD.
950,000 APBN-P - 930 MBOPD
Oil and Condensate Production in 2012
900,000
WP&B Revision = 878.5 MBOPD
850,000
June 24th, 2012 -MCL: -24MBOPD Total S/D for TAR -HESS: -6 MBPOD, 18 pipeline pigging of several wells in WHP-A and WHP-B Shutdown -TEPI: Handil compressor
800,000
BOPD
July 15th, 2012 -JOBPPEJ, PEP, MCL: -52 MBPOD. Shutdown SKW wells because of issues in the Hose Off replacement process. Shore pipeline at FSO Cintanatomas and MCL to Mudi rate reductions.
750,000 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12
33
D. OIL & GAS PRODUCTION ACTIVITIES
Based on the production attained in 2012, only 3 out of 50 oil producing PSC Contractors were able to fulfill their APBN-P target. 15 out of 50 oil producing PSC Contractors produced higher than the previous year. The 15 PSC Contractors are Hess (Indonesia-Pangkah) Ltd., PT. Pertamina EP, JOB Pertamina-Talisman Jambi Merang, PT. Pertamina Hulu Energi ONWJ, Mobil Cepu Ltd., PT. Sumatera Persada Energi, Medco E&P Tarakan, BP Berau Ltd., Camar Resources Canada Inc., MontdOr Oil (Tungkal) Ltd., Santos (Sampang) Pty. Ltd., Star Energy (Kakap) Ltd., EMP Malacca Strait, S.A., Lapindo Brantas, Inc., and JOB Pertamina-EMP Gebang.
15 PSC Contractors with Higher Oil Production than 2011
140,000 120,000 100,000 80,000 60,000 40,000
7,000
4,951
Total increase in production from 15 PSC Contractors against 2011 is 14,7 MBOPD
6,000 5,000
3,203 2,891 1,067 948 321 311 296 261 169

r
4,000 3,000 2,000 1,000
BOPD
126
91
24
16
o
S a M J CL E u an ar gy ng ES SP ra O TJ m M ak er ON ac nd m Be Ca pa rta BP Ta r on En al pi Ge m ba H td ng W ca in
BP
Pe
JO
Sa
PH
co
ar
La
St
2011 2012 Difference
Based on the 2012 actual production attained in 2012, the 10 PSC Contractors with the largest oil production disparity from the set target with a total of 50.9 MBOPD, are Kangean Energy Indonesia, Ltd. (-69.8%), ExxonMobil Oil Indonesia Inc. (-22.1%), ConocoPhillips Indonesia Inc. Ltd. (-18.2%), Total E&P Indonesie (-17.9%), PT. Pertamina Hulu Energi West Madura Offshore (-16.1%), PetroChina International Bermuda, Ltd. (-15.2%), CNOOC SES, Ltd. (-8.1%), PetroChina International Jabung, Ltd. (-4.8%), PT. Chevron Pacific Indonesia (-4.5%), and Chevron Indonesia Company (-3.8%).
10 PSC Contractors with the Largest Oil Production Disparity in 2011-2012
400,000 350,000 300,000
(15,995) (14,615)
Sa
nt
EM
ed
EM
os
(17,500)
Total decrease in production from 10 PSC Contractors against 2011 is 50.9 MBOPD (9,581)
(15,000) (12,500) (10,000) (7,500)
250,000 200,000 150,000
(2,810)
(5,000)
2011
BOPD
100,000 50.000 I EP B C
(2,196) (1,874)
(1,084)
(982)
(945)
(850)
(2,500)
Difference
2,500
O n CI CO OI a CP OO ea ud ok TA L ng m EM W Bl CN ab un M g
Ka
er
TO
CO PI
PH
.B
34
PC
PC
.J
BBLS
2012
BBLS
20,000
SKK MIGAS
ANNUAL REPORT 2012
Main Challenges in Attaining the 2012 Targeted Oil Production
The main challenges in attaining the 2012 targeted oil production are:
The contribution of development drilling was only 76.8% of the target, among others
caused by procurement issues regarding rig availability, permit process, subsurface and land acquisition. PetroChina International Jabung, Ltd. could not produce from drilled wells due to land permit issues for pipelines for the past 2 years. At this moment oil production is transported by trucking, which resulted in loss of potential amounting to 3,000 BCPD of unliftable condensate and 30 MMSCFD of flared gas. Breakdown or damage to production facilities e.g. compressors, electricity supply, instrumental, artificial lift, leaking subsea umbilical riser and flowline (SURF), and surface pipeline. Oil transportation issues by trucking, inter alia at PT. Sele Raya Merangin Dua and PetroChina International Jabung, Ltd. Subsurface of loose sand issues at Total E&P Indonesie. The Pagerungan Utara Offshore Field at Kangean Energy Indonesia, Ltd. was abandoned due to it being uneconomical. Delay of the Turbin moving project in CNOOC SES, Ltd. following the fire at FSO Lentera Bangsa. Prolonged shutdown at the LNG Tangguh Plant. No significant additional production from PT Pertamina Hulu Energi WMO following the West Madura Offshore contract area extension.
35
D. OIL & GAS PRODUCTION ACTIVITIES
Gas
Realization of gas production in the past year has shown an incline, however in 2012 production declined to 8,167 MMSCFD, primarily caused by a drop in production from Total E&P Indonesie and BP Berau Ltd.
10,000 8,070 8,857 7,986 7,823 7,660 7,283 7,460 7,962 8,415 8,167
Gas Production
8,000 6,498 6,000 6,289
7,752
4,000
Gas
MMSCFD
2,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
The 2012 gas production still rests on fields operated by Total E&P Indonesie in East Kalimantan; BP Berau Ltd. in Papua; PT Pertamina EP, PT Pertamina Hulu Energi, ConocoPhillips in Sumatera and Natuna; Vico Indonesia in East Kalimantan; and other fields operated by ExxonMobil Oil Indonesia Inc. in Aceh, Petrochina International Jabung, Ltd. in Jambi; PT Pertamina Hulu Energi West Madura Offshore; and Kangean Energy Indonesia, Ltd.
2012 Gas Production and Distribution
9,600 Production 8,800 WP&B Production = 8,523 MMSCFD
8,000
APBN Lifting = 7,655 MMSCFD
7,200
Production WP&B Production Distribution APBN Lifting

MMSCFD
WP&B Lifting = 6,985 MMSCFD 6,400

August 2012 -BP Berau: 900 MMSCFD, curtailment prod caused by surging in export line tank-1 since August 14th. -Premier: 72 MMSCFD, Phase 4 of the Anoa Project since August 13th. -KEI (120 MMSCFD), Santos Madura (40 MMSCFD), COPI Grissik (26 MMSCFD), Hess (11 MMSCFD) Low demand on religious holidays.
5,600
*Addition production from development wells, WO, WS and POP / new Fields based on 2012 WP&B
BP Berau: Preparation and implementation of TAR-3 Train-1 (for 36 days) EMOI: TA NSO (for 24 days)
BP Berau: Shutdown Train #2 caused by fire in the Gas Turbine
WP&B Lifting
4,800
BP Berau : Train 1 & 2 Unplanned Shutdown
4,000 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12*
36
SKK MIGAS
ANNUAL REPORT 2012
Based on the 2012 actual production, there were 10 PSC Contractors with the largest gas production disparity from the set target with a total of 639 MMSCFD.
The main challenges in attaining the 2012 gas production target are: The contribution of development drilling was only 84% of the target, among others caused by delay in drilling schedules subsurface, and readiness production facilities. Breakdown / damage to production facilities for e.g. compressors, electricity supply, instrumental, artificial lift, and surface pipeline. Subsurface issues at Total E&P Indonesie. Unreadiness Buyers to offtake gas. Based on the 2012 actual production the 10 PSC Contractors with the largest gas production disparity from the target with a total of 639 MMSCFD, are Chevron Makassar (-31.1%), Santos Madura (-29.8%), Total E&P Indonesie (-19.1%), Star Energy (-18.6%), Medco Lematang (-17.3%), ExxonMobil Oil Indonesia Inc. (-17.0%), PT Pertamina Hulu Energi WMO (-15.6%), PT Pertamina Hulu Eenergi ONWJ (-10.8%), CNOOC SES Ltd. (-4.9%), and PT Pertamina EP (-0.6%).
10 PSC Contractors with the Largest Gas Production Disparity in 2011-2012
2,500
(442)
2,000
Total decline in production for 10 PSC Contractors in 2011 is 639 MMSCFD
(500)
(450)
1,500
(300)
1,000
(200)
MMSCFD
2011 2012 Difference
500
(79) (35) (25) (24) (8) (8) (7)

sr
(100)
(6)
C
(6)
in a
EP OI a M O J g ur W an gy EM TA L M ks ad OO N er EW at EO En CN m
PH
TO
PH
Le
St ar
to s
Sa n
co
M ed
Ch
ev
Pe
ro
rta
MSCF 37
E. OIL AND GAS LIFTING
E.
1,000,000
OIL AND GAS LIFTING

16,000,000
Oil Lifting
Oil and Condensate Production, Lifting & Stock in 2012 Production Lifting Total Stock
900,000 14,000,000
800,000
12,000,000
Production / Lifting (BOPD)
884,323
882,252
869,744
879,281
860,192
854,241
853,409
884,240
844,617
837,167
832,960
835,059
859,743 858,759 9 0
700,000
10,000,000
600,000
8,000,000
500,000
6,000,000
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Average
*Total closing stock consists of stock including dead stock and field stock
The 2012 actual oil lifting was 860 thousand BOPD or 92.5% of the target set in 2012 APBN-P. In order to fulfill the needs of domestic fuel, SKK Migas prioritizes governments oil lifting portion to be distributed to domestic refineries in accordance to the specification to be processed in those refineries. In 2012, oil lifting for domestic needs reached 66%.
Gas Lifting
Gas Utilization
8,000 7,200 6,400 5,600 4,800
8,000
7,715 6,349 5,877 5,882 5,715 6,688 7,184
7,345
7,181
7,200 6,400 5,600 4,800 4,000 3,200 2,400
6,347
Export Domestic Total
4,000 3,200 2,400
4,416 1,466
4,202 1,513
4,008 2,341
3,820 2,527
3,775 2,913
3,861 3,323
4,336 3,379
4,078 3,267
1,600
3,631 3,550
4,397 1,480
1,600 800 -
BBTUD
800 -
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Gas Lifting and Prices in 2012
12,000
18
15.90
11,000 10,000 9,000 16
13.75 13.56 13.68
13.54
13.14
12.30
13.33 13.49 13.04
12.64 12.38
14 12
Export Gas Price

BBTUD
8.99 5.66 6.43 7.03 6.21 6.12 6.10 6.46 6.57 6.61 6.65
8.87
10 8 6
Gas Lifting Domestic Gas Price
8,000 7,000
7,464
7,188
7,824
7,495
7,105
7,478
7,126
7,515
6,556
6,726
6,918
6,000 5,000
6,758
7,181
4 2 -
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Average
38
US$ / MMBTU
BBTUD
Stock (BBLS)
884,369
862,196
860,805
842,912
852,935
813,548
872,139
848,627
790,446
823,962
906,987
948,945
SKK MIGAS
ANNUAL REPORT 2012
Domestic Gas Utilization in 2012
7.96%
10.19%
OIL LIFTING
10.19%
33.43%
33.43%
INDUSTRY
7.96%
DOMESTIC LPG
18.51%
26.72%
ELECTRICITY
3.18%
DOMESTIC LNG
26.72%
18.51%
FERTILIZER
0.01%
CITY GAS
In 2012, significant additional domestic gas supplies were from Terang Field (Kangean contract area), Wortel Field (Sampang contract area), and South Mahakam Field (Mahakam contract area), also APN E/F Field (ONWJ contract area).
In 2012, there was a significant raise in gas supply for domestic consumer compared to previous years. The total gas lifting in 2012 was 7,180,69 BBTUD. The utilization of gas lifting for domestic consumers was 3,550,07 BBTUD or 49.44% and for international consumers was 3,630.62 BBTUD or 50.56%. Gas utilization for domestic needs were: Fertilizer and petrochemical 675.06 BBTUD (18.51%), Electricity 948.62 BBTUD (26.72%), Industry 1,186.89 BBTUD (33.43%), City Gas 0.45 BBTUD (0.01%), LPG Conversion program 282.60 BBTUD (7.96%), Domestic LNG 112.90 BBTUD (3.18%), Oil lifting 361.78 BBTUD (10,.19%). LNG shipment of 112.91 BBTUD to domestic buyers was a major step for SKK Migas in supporting the Governments program to decrease subsidization of primary energy to PLN, by sending LNG from the Mahakam contract area to domestic buyers through Nusantara Regas Floating Storage Regasification Unit (FSRU) located in offshore Tanjung Priok. This LNG contract commitment started on April 25th, 2012 with 1.5 MTPA (or equal to 26 LNG Cargoes per year) for a period of 10 years (up to 2021). Furthermore, to support domestic gas needs, SKK Migas supervises and encourages early on-stream in Indonesian gas fields. For 2012, the additional gas supply for domestic needs came significantly from Terang Field (Kangean contract area), Wortel Field (Sampang contract area), and South Mahakam Field (Mahakam contract area), as well as from APN E/F Field (ONWJ contract area).
39
E. OIL AND GAS LIFTING
Gas Sales Agreements Signed in 2012
2 2
CONTRACTS
FERTILIZER AND PETROCHEMICAL
17 10
17 10
CONTRACTS
2 1
CONTRACTS
ELECTRICITY CONTRACTS
OIL LIFTING CONTRACT
INDUSTRY
DOMESTIC LNG
SKK Migas commitment to supply gas to domestic buyers in 2012 was realized through the signing of 32 contracts.
SKK Migas commitment to supply gas to domestic buyers in 2012 was realized through the signing of 32 contracts (Heads of Agreements, Gas Sales Agreements dan Gas Sales Agreement Amendments). The details of the utilization of gas in the agreements were as follows:
2 contracts for oil lifting with a total supply of 1.01 BCF. 2 contracts for fertilizer and petrochemical with a total supply of 286.35 BCF. 17 contracts for electricity with a total supply of 580.73 BCF. 10 contracts for industry with a total supply of 156.89 BCF.
In addition, 2012 was a monumental year for LNG utilization in Indonesia, especially from Tangguh Field with the signing of a Heads of Agreement with PT PLN (Persero) to fulfill its electricity need by supplying gas for 20 years and LNG supply equal to 23.96 MT.
40
SKK MIGAS
ANNUAL REPORT 2012
Accumulated Volume of Domestic Gas Contracts
25
20
15
Fertilizer Electricity Industry

10
TCF
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Fertilizer Electricity Industry .10 1 1.18 0.10 1.17 2.28 2.70 1.77 3.17 4.10 1.94 4.41 4.20 2.88 6.25 6.15 3.08 6.94 10.07 3.33 7.01 10.18 3.61 7.59 10.34 3.33 7.01 10.18 3.61 7.59 10.34
In supporting the Governments plan to convert gasoline fuel into gas fuel for transportation (Bahan Bakar Gas / BBG), SKK Migas has committed to supply gas for BBG conversion to Jabodetabek (4 BBTUD), Palembang (1 BBTUD), and Surabaya (5 BBTUD). In addition, SKK Migas has encouraged the Local Government (through local-owned enterprises) to procure gas supplies from PSC Contractors so as to participate in the development of gas fuel for transportation with the signing of a Memorandum of Agreement (MOA) for 20 cities in Java, Sumatera, Kalimantan and Sulawesi. In supporting the Governments plan to develop city gas, SKK Migas has committed to supply gas for city gas to Surabaya, Tarakan, Palembang, Bekasi and Depok. SKK Migas has also commited to support city gas developments in Wajo, Blora, Bontang, and Ogan Ilir.
41
F. STATE REVENUES
F.
40,000 35,000 30,000 25,000 20,000
STATE REVENUES
115%
110%
104%
107% 104%
102%

22,203 30,659 19,104 26,060 32,406
23,793
35,302
19,950
26,497
35,798
Million US$
5,000 -
2007
2008
2009
2010
2011
2012*
In 2012, SKK Migas successfully contributed US$34.9 billion to state revenues (accounting period January - December 2012) or 104% of the 2012 APBN-P target. This was achieved by optimizing domestic gas prices by an average of more than 11% and oil prices by an average of more than 1%, compared to 2011. SKK Migas continually manages operating costs to be more effective and efficient, so as to ensure that the upstream oil and gas industry is able to contribute in the utmost to the State.
42
34,934
Realization
APBN / APBN-P Target
10,000
33,485
15,000
SKK MIGAS
ANNUAL REPORT 2012
Distribution of Revenues from the Upstream Oil and Gas Industry
90,000
2,204 2,255 2,254
2,282
2,326 2,219 2,050 2,033 2,158 2,067 2,097
2,400 2.200 2,000

60,769 61,065 34,934
80,000 70,000
Lifting (MBOE/D) Inc DC. Exc

* December 31st, 2012 status awaiting final recapitulation Million US$
1.800 1,600 1,400 1.200 1.000
PSC Contractor Share Cost Recovery
60,000 50,000 40,000

32,051 36,294 38,707 23,793 22,638 19,797
54,152 35,301 45,869 26,497
35,798
35,752 19,950
Government Share Gross Revenue
30,000 20,000 10,000 16.665 9,633 5,060 1,972 18,529 10,845 5,517 2,167
24,153 13,675
800
15,341 15,715
600 400
9,339 7,401 3,077 7,563 4,691 8,112 5,544 8,710 9,512 6,204 5,694 10,108
11,762 9,657 10,416
7,608
200 -
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012*
From year to year, upstream oil and gas revenues have shown an upward trend. This generated a 58% average total GOI take against gross revenue, while the average net contractor take against gross revenue to be 15%. This shows that the Return of Investment in Indonesia is still attractive. This increase was influenced by continues developments in the management of cost recovery; and by maintaining a 25-29% ration between cost recovery and gross revenue, while still encouraging new investment projects in the upstream oil and gas industry.
From year to year, upstream oil and gas revenues have shown an upward trend. This shows that the Return of Investment in Indonesia is still attractive.
43
MBOE/D
G. PRODUCTION PSC CONTRACTORS ACTUAL INVESTMENT
G.
Production PSC Contractors Actual Investment
25,000 20,000
PRODUCTION PSC CONTRACTORS ACTUAL INVESTMENT
Production Development Administration Exploration Total Expenditure

16,113
15,000
14,022 719 958
1,439 1,016
10,615
10,000
10,425 633 730 2,671
11,031 670 833 2,495
9,142 474 869
532 981 2,523
3,288 3,149
5,000
2,088
Million US$
5,711
-
6,579
6,391
7,033
9,196
10,370
2007
2008
2009
2010
2011
2012*
Growth of upstream oil and gas industry in the last 4 years shows that the investment climate in this sector is still healthy and conducive.
Actual investment of upstream oil and gas industry (expenditures) for production contract areas in the last 4 years shows growth. This shows that the investment climate in this sector is still healthy and conducive, and has great prospects. In 2012, investment in the upstream oil and gas sector reached US$16.1 billion, this is higher by US$2.1 billion compared to 2011. Those investments were used to fund US$1.4 billion exploration activities, US$3.3 billion development activities, US$10.4 billion production activities and US$1 billion administrative activities. From this, we can conclude that the bulk of investments are for production and development activities reaching US$13.7 billion or 84,8% of the total investment in the upstream oil and gas industry, compared to last years production and development activities portion which reached US$12.3 billion or 88%. The implications of this increase not only affects the production profile and the oil and gas reserves portfolio, but also affects the supporting domestic oil and gas industrys ability to increase its national capacity.
44
SKK MIGAS
ANNUAL REPORT 2012
H.
Exploration PSC Contractors Actual Investment Exploration PSC Contractors Investment
EXPLORATION PSC CONTRACTORS ACTUAL INVESTMENT

2,500 2,120 2,000 1,661 1,500 1,481 1,356 917
1,000 Million US$
500
2008 2009 2010 2011 2012*
Exploration investments to find new oil and gas reserves in the exploration contract areas have increased from time to time. Nonetheless in 2012 a decline occurred, mainly caused by: A drop in exploration drilling activities, particularly deep-water drilling. Drilling results conducted in 2011 still needs evaluation and detailed studies to be able to determine further exploration activities. Exploration investment activities have a positive impact for future development prospects of upstream oil and gas, and to maintain the availability of energy for future generations. Until the end of 2012, the cumulative exploration investment in exploration contract areas not yet recovered reached US$6.7 billion.
In addition, the values of exploration investments in terminated contract areas are US$1.3 billion. The total investment expended by PSC Contractors in conducting exploration activities is non recoverable considering the contract area was terminated.
Non Recoverable Exploration Costs Caused by Termination of Exploration Contract Area
600 500 400 300 540
Million US$
Amount
200 100 -
205 98 50 0 2002 2003 2004 2005 17 2006 40 122 40 72 143
2007
2008
2009
2010
2011
2012*
Total
US$1,327 Million
Unsuccessful exploration , as one of the risks of upstream oil and gas industry, has become a natural occurrence. For the Government, the investment remains qualitatively useful, in the form of exploration data, which is useful for future potential hydrocarbon studies.
45
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SKK MIGAS
ANNUAL REPORT 2012
II
EFFORTS TO INCREASE PRODUCTION
47
II. EFFORTS TO INCREASE PRODUCTION
A. NEW PROJECTS
For the last decade, we have produced 3.7 billion barrels of oil, while new oil reserves only contributes an additional 2.8 billion barrels, this has caused a cumulative decrease in oil reserves of 92.34 million barrels. If no efforts are conducted, then the decrease in reserves can be greater, thus causing difficulties in fulfilling the Governments target. To increase production, in 2012, several efforts were carried out, such as accelerating the development of producing oil and gas fields, encouraging the application of secondary recovery, enhanced oil recovery (EOR), improving coordination with relevant Government institutions, as well as a more intensive management approach towards exploration PSC Contractors in the form of a forum (PSC Contractors Forum for Exploration Contract Area FOKWE) and knowledge sharing.
48
SKK MIGAS
ANNUAL REPORT 2012
A.
New Projects Realization
NEW PROJECTS
During 2012, there were 12 on-stream projects with 1,062 MMSCFD of gas and 23,600 BOPD of oil/condensates installed production capacity. Considering many of the on-stream projects occurred in Q3 and Q4 of 2012, as well as the unpreparedness of the gas buyers, the additional average production in 2012 was approximately only 430MMSCFD and 5,600 BPD from the installed production capacity.
PROJECT
PSC CONTRACTORS
INSTALLED PRODUCTION CAPACITY Gas (MMSCFD) 50
ONSTREAM
TOTAL INSTALLED PRODUCTION CAPACITY
Wortel Development APN A Gas Development APN B Gas Development APN E / F Gas Development South Sembakung Gas Plant Transfer Line 4 x 25 Km BS-Tampi Pauh Terang Sirasun Batur Phase 1 Peciko 7B Extension Platform
Santos
January 2012 January 2012 April 2012 May 2012 May 2012 May 2012 June 2012 June 2012
OIL / CONDENSATES (BOPD)
23,600
TOTAL INSTALLED PRODUCTION CAPACITY
PHE ONWJ PHE ONWJ PHE ONWJ Job Pertamina Medco Simenggaris Pty. Ltd Sele Raya Merangin Dua Kangean Energy Indonesia Total E&P Indonesie Total E&P Indonesie ConocoPhillips Indonesia Star Energy ConocoPhillips Indonesia
Gas (MMSCFD) 50 Gas (MMSCFD) 45 Gas (MMSCFD) 50 Gas (MMSCFD) 25 Oil/Condensates (BPD) 3,000 Gas (MMSCFD) 300 Gas (MMSCFD) 122
Oil/Condensates (BPD) Gas (MMSCFD)
GAS (MMSCFD)
1,062
During 2012, there were 12 on-stream projects with 1,062 MMSCFD of gas and 23,600 BOPD of oil/condensates installed production capacity.
South Mahakam 1&2 Bawal Subsea KF Gas Booster Compression System Tembang Subsea
October 2012 September 2012 November 2012 January 2012
20,600
250
Gas (MMSCFD) 120 Gas (MMSCFD) 10 Gas (MMSCFD) 40
49
B. IMPROVED OIL RECOVERY
B.
IMPROVED OIL RECOVERY
Improved Oil Recovery (including Enhanced Oil Recovery)
Other efforts to improve short-term production are by applying Improved Oil Recovery, including the use of EOR technology. Enhance Oil Recovery (EOR) is a technique for further extraction by improving the mobility of oil by steam, chemical, gas or microbial injection to increase the amount of crude oil from mainly mature fields. Types of EOR used in oil and gas production fields are:
Steam Flood
Steam flood is conducted by PT Chevron Pacific Indonesia in the Duri and North Duri Development (NDD) Fields. In 2012, oil production from the Duri Field reached 165,057 BOPD. The NDD Field consisting of Area-12, Area-13 and Area-14 started production in December 2010. At this time, NDD Area-12 has produced 43,875 BOPD from 532 development wells. While NDD Area-13 will be developed in 2013.
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SKK MIGAS
ANNUAL REPORT 2012
Other efforts to improve short-term productions are by applying Improved Oil Recovery, including the use of EOR technology.
Gas Flooding
Gas flooding was conducted in the Handil Field (Total E&P Indonesie). The technology used was a joint water flood and gas flood project. Since 2007, gas injection was halted to aid the supply shortage to the the Bontang LNG Plant. In 2012 a study in gas flooding was conducted on several fields:
CO2 gas study in Gemah Field, PetroChina Jabung (currently in the reservoir
simulation stage); and
CO2 gas study in Jatibarang Field, PEP (finished the laboratory simulation and field
trials will commence in 2013).
Chemical Flooding
Chemical flooding is planned to be conducted in the Minas Field (PT. Chevron Pacific Indonesia), Kaji-Semoga Field (Medco E&P Indonesia), Tanjung Field (PT. Pertamina EP), Handil Field (Total E&P Indonesie), Widuri Field (CNOOC SES Ltd), as well as Zamrud and Pedada Fields (PT. BOB Bumi Siak Pusako), with the following status:
Minas Field: simulation and laboratory studies are finished and field trials will
commence in Q1 2013.
Kaji-Semoga Field: simulation and laboratory studies are finished and pilot project will
Tanjung Field: simulation and laboratory studies are finished and field trials will
commence in 2013.
Handil Field: conducting laboratory study. Widuri Field: simulation and laboratory studies are finished and field trials will
Zamrud and Pedada Fields: field trial is planned for 2013.
51
C. REACTIVATION OF SUSPENDED WELLS
C.
To increase production, SKK Migas with PSC Contractors have inventoried potential suspended wells to reactivate.
REACTIVATION OF SUSPENDED WELLS
To increase production, SKK Migas with PSC Contractors have inventoried potential suspended wells to reactivate. Those wells were suspended for numerous reasons. Based on the data collected, a majority of the prospective reactivation wells are located in PT Pertamina EPs contract area. Out of the 5,144 wells inventoried and evaluated, only 1,755 wells are able to be technically reactivated. The wells are located in the Sumatra region (454 wells), the Java region (437 wells), and in the Kalimantan region (864 wells). Through 2012, a total of 154 wells have been reactivated, compromising of 118 wells reactivated as production wells and 36 wells reactivated as injection wells. This activity has accomplished a raise in production (initial gain) of 18.6 BOPD/well for oil and 2.7 MMSCFD/well for gas. In 2013, an additional 130 wells are planned for reactivation, with an estimated production of 953 BOPD.
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SKK MIGAS
ANNUAL REPORT 2012
D.
PSC CONTRACTORS FORUM FOR EXPLORATION CONTRACT AREA (FOKWE)
One of the objectives of exploration is to sustain the continuity of oil and gas production. For the last 10 years, discoveries of new reserves were small, in part caused by the relatively small number of PSC firm commitments fulfilled and several obstacles in the field. Constraint in the implementation of firm commitment are predominantly caused PSC Contractors internal difficulties, overlapping of areas (including permits), G&G technical issues, social community issues (related to land acquisition), non-availability of supporting goods and services, drilling operations, non-availability of data, procurement process and certain other issues, mostly near the border. To find a solution to these constraints, in 2011, BPMIGAS (now SKK Migas) formed a PSC Contractors Forum for Exploration Contract Area (Forum Operator Kontraktor KKS Wilayah Kerja Eksplorasi / FOKWE). FOKWE has 4 committees: 1. Partnership Committee. 2. Permit and Social Committee. 3. Procurement and Operational Committee. 4. G&G Technical Committee.
To find a solution to firm commitment constraints in 2011, BPMIGAS (now SKK Migas) formed a PSC Contractors Forum for Exploration Contract Area (FOKWE).
53
D. PSC CONTRACTORS FORUM FOR EXPLORATION CONTRACT AREA (FOKWE)
Every constraint faced by exploration PSC Contractors is categorized into individual committees.
FUNCTIONS: LEGAL, FINANCE, HUMAN RESOURCES
PARTNERSHIP COMMITTEE
PROCUREMENT & OPERATIONAL COMMITTEE
FUNCTIONS: PROCUREMENT, FIELD OPERATIONS
FUNCTIONS: EXPLORATION, EVALUATION AND DEVELOPMENT
G&G TECHNICAL COMMITTEE
PERMIT & SOCIAL COMMITTEE
FUNCTIONS: COMMUNITY RELATIONS, SECURITY, FORMALITIES, REPRESENTATIVE
FOKWE SECRETARY
FUNCTIONS: EXPLORATION & OPERATION, SECRETARIAT OFFICE, FOKWE INFORMATION SYSTEM, COORDINATION MEETING
Resolved Constraints 2012 Firm Commitment Constraints

OVERLAPPING, PERMITS, SOCIAL COMMUNITY, FIELD OPERATIONS INTERNAL PSC CONTRACTORS (OPERATORSHIP, FINANCIAL, PRIORITY HOLDING) NON AVAILIBILITY OF SUPPORTING GOODS AND SERVICES SUBSURFACE COMPLEXITY NEEDING GGR STUDIES NON AVAILABILITY OF EXISTING DATA 9 1 (11%) 8 1 (13%) 7 4 (59%) CONTRACT AREA 0 10 20 30 40 50 60 51 30 (59%) 34 15 (44%) 13 13 (100%)
Note: 1 contract area can have more than 1 constraint
PROCUREMENT PROCESS
Achievements in Exploration Drilling Firm Commitments
50%
40%
40% 31%
30%
26%
20%
10%
2010
2011
2012
54
SKK MIGAS
ANNUAL REPORT 2012
FOKWEs activities are under the coordination of the FOKWE Secretariat and throughout 2012 have given significant contributions in managing firm commitment constraints.
Constraints in the implementation of firm commitment in exploration contract areas are the reason FOKWE was established (based on Letter of Decree Number 0161/BPW00000/2011/S1 dated September 5th, 2011). Throughout 2012, FOKWE have given significant contributions in managing firm commitment constraints, particularly in drilling exploration wells. Some of the constraints resolved were overlapping land ownership (59%); PSC Contractors internal issues (44%); subsurface complexity issues (11%); and procurement issues (57%). Regarding availability of supporting goods / services, considering joint procurement of rigs were initiated in 2012 for a period of 2.5 years, then the percentage of resolution for those issues cannot yet be calculated awaiting rig allocation schedules. With the continued growth of contract areas, more constraints will be encountered. To encourage the resolution of exploration constraints, the cooperation of all members and stakeholders are needed. The exploration activities is targeted to accelerate Resources to Reserve to Production (R2P) so as to offset the decline rate of natural production with challenging internal and external conditions.
55
E. COOPERATION WITH OTHER INSTITUTIONS
E.
COOPERATION WITH OTHER INSTITUTIONS
In 2012, SKK Migas signed numerous agreements with several institutions to strengthen SKK Migas role of management and control while at the same time fostering national capacity.
In 2012, SKK Migas signed numerous agreements with several institutions to strengthen SKK Migas role of management and control while at the same time fostering national capacity. One of the parties who we are actively inviting to cooperate are universities. In May 2012, BPMIGAS (now SKK Migas) signed a Memorandum of Understanding with 6 universities (ITB, UI, Trisakti, UGM, UNPAD, and UPN) and the Education and Training Agency, Ministry of EMR (BADIKLAT KESDM) to cooperate in conducting the National Capacity Building (NCB) program in Jakarta. BPMIGAS (now SKK Migas) has also signed an agreement with Padjadjaran Universitys Law Faculty (UNPAD) to conduct law research and development, legislation reviews, commercial contracts, legal opinions and other legal aid to boost understanding, compliance and legal awareness. BPMIGAS (now SKK Migas) has also signed agreements with other universities, among others University of North Sumatra (USU) and Sebelas Maret University (UNS) Surakarta. A group discussion is also held at Gadjah Mada University (UGM) and UPN Veteran Yogyakarta.
56
SKK MIGAS
ANNUAL REPORT 2012
F.
1. Exploration and Production Forum
KNOWLEDGE SHARING
To increase national oil and gas production, SKK Migas in conjunction with PSC Contractors held knowledge sharing forums, which are forums to share successful experiences and build the spirit of partnership to respond to various diverse challenges. With these forums, it is hoped that technical challenges in increasing production can be resolved. The following is some of the forums and workshops held by SKK Migas in 2012:
The 2012 Exploration and Production Forum, Todays Exploration, Tomorrows Reserves and Production, was held in Bandung from May 30 th until June 1st, 2012, and attended by 186 participants from exploration PSC Contractors, production PSC Contractors, Government institutions, Universities, and BPMIGAS (now SKK Migas). The purpose of this forum was to increase oil and gas production in 2013-2017, and to transfer knowledge / experience in exploration and production between PSC Contractors and service companies as one of the efforts to maintain national oil and gas production. With the goal to accelerate the development of exploration wells for production, and to help resolve exploration constraints.
2. E&P Knowledge Sharing Forum for PSC Contractors in the Kalimantan Area
This Forum was a place to share the experience of PT Pertamina EP with PSC Contractors in the Kalimantan area regarding subsurface aspects, IOR / EOR, wells, and production facilities to increase production of Pertaminas Fields and other Fields in the Kalimantan area. Held in Balikpapan on February 10-11, 2012, and attended by 176 participants from PSC Contractors in the Kalimantan area, PT Pertamina EP, Government institutions and BPMIGAS (now SKK Migas). A few of the follow-ups recommended by this forum are:
To increase national oil and gas production, SKK Migas in conjunction with PSC Contractors held knowledge sharing forums, so that technical challenges in increasing production can be resolved.
To explore the Eocene Play in the Kalimantan and Makassar Strait area. To aggressively use base grid drilling for the tank system in the deltaic system
supported by well economics.
To increase the quality and quantity of national human resources in conjunction with
the fields development.
To optimize assets by reactivating suspended wells and conducting GGRF studies. To identify bottle necking in optimizing production.
57
F. SHARING KNOWLEDGE
3. Project Management and Production Facilities Maintenance Forum (Forum Pengelolaan Proyek dan Pemeliharaan Fasilitas Produksi / FP3FP)
The FP3FP, Professionally Implementing Project Management and Maintenance in Supporting National Production, was held in Medan on February 22-24, 2012, and attended by 399 participants from BPMIGAS (now SKK Migas), PSC Contractors, and several invited guests. This forum was held to share information and best practices in project management and maintenance, socialization of Standard Operating Procedures, as well as outlining issues and finding alternative solutions in project management and maintenance.
This forum is held to share information and best practices in project management and maintenance, socialization of Standard Operating Procedures, as well as outlining issues and finding alternative solutions in project management and maintenance.
Some conclusions on the FP3FP forum were: The delay of PSC Contractors projects in Indonesia was not automatically considered a failure in the project, based on the Independence Project Analyst survey the average delivery of project according to schedule is 50%. The PSC Contractors Management Projects strategy was on-stream on-time by managing the projects schedule, costs, quality and standard for health, safety and the environment, as well as maximizing the use of local and national capacities. SKK Migas was finalizing the Project Management guidelines. The POD and AFE submission schedule should be evaluated to avoid further difference in cost and time. POD was submitted up to the semi-FEED stage and not only conceptual design to attain better accuracy and minimize project risk. Delay in projects was also caused by PSC Contractors delay in submitting tender plans and procurement processes taking longer than planned. SKK Migas should revise the POD and AFE approval process in anticipation of project risks. POD drafting should be backed up with a comprehensive risk assessments and mitigation plans to address any risks that might arise in its implementation. While the conclusions regarding Production Facilities Maintenance were:
PSC Contractors production facilities maintenance strategy is to maintain continuity of

oil and gas production operations by maximizing planned maintenance and hastening response time for shutdowns. A 96.7% availability of production was a world-class achievement. The asset integrity program was part of a companies risk management as a tool to ensure the maintenance of equipment during operations. To increase organizational and employee competencies. To increase coordination and communication between PSC Contractors (clustering). To improve communication with the Government and relevant stakeholders.
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SKK MIGAS
ANNUAL REPORT 2012
The Internal Audit Forum was held to promote the Internal Audits function in PSC Contractors, as well as encouraging them to conduct strategic activities.
4. Internal Audit Forum
Based on the mapping of 30 production PSC Contractors, only 12 PSC Contractors have internal audits (IA), while the other 18 PSC Contractors do not have IA. Also the main tasks and functions of IA in PSC Contractors IA are not focused on strategic issues, such as cost recovery efficiency, increasing government revenue, and increasing lifting. This IA Forum was held in October 11-12, 2012 to promote the IA function in PSC Contractors, as well as encouraging them to conduct strategic activities. An active role by BPMIGAS (now SKK Migas) will urge the establishment of a good internal control to ensure affectivity and efficiency of operation and avoid State losses. This forum invited practitioners, professionals and Government as speakers, and 158 participants from BPMIGAS (now SKK Migas) and PSC Contractors. The BPMIGAS Ethics Guidelines (Pedoman Etika / PE), Guidelines Governing Gratification (Pedoman Pengendali Gratifikasi / PPG), and Whistle Blowing System (WBS) were also socialized at this forum so as to encourage PSC Contractors to adopt or at least abide it.
59
60
SKK MIGAS
ANNUAL REPORT 2012
III
ISSUES AND RESOLUTIONS
61
III. ISSUES AND RESOLUTIONS
A. LAND ACQUISITION AND PERMITS
A.
Land acquisition and permit issues have long since become a significant hurdle in increasing oil and gas production. To overcome these issues, in 2012 the Government has enacted several regulations to support the resolution of land acquisition and permit issues.
LAND ACQUISITION AND PERMITS
Land acquisition and permit issues have long since become a significant hurdle in increasing oil and gas production. To overcome these issues, in 2012 the Government has enacted several regulations to support the resolution of land acquisition and permit issues, which are:
1. Presidential Instruction Number 2 of 2012 on Increasing National Oil Production. 2. Law Number 2 of 2012 on Land Acquisitions for Public Interests. 3. Presidential Regulation Number 71 of 2012 on Facilitating Land Acquisitions for Public
Project Purposes. Previously, Law Number 22 of 2001 on Oil and Gas governed land acquisition for the oil and gas industry. After the implementation of Law Number 2 Year 2012, land acquisition for the oil and gas industry is categorized as for public interests. In such, it was hoped that land acquisitions and permit issues caused by the public perception that upstream oil and gas projects are corporate projects would be solved. However, there are still numerous issues in land acquisition. Based on Law Number 2 Year 2013 jo. Presidential Regulation Number 71 of 2012 jo. Head of BPN Regulation Number 9 of 2012, it is predicted that land acquisition will require a lengthy process (normally 282 working days, with a maximum of 546 working days). We hope a regulation shortening the land acquisition mechanism specific for oil and gas infrastructure will soon be passed.
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SKK MIGAS
ANNUAL REPORT 2012
One of SKK Migas accomplishments in 2012 was handing over land compensation in order to fulfill certain obligations as stated in the Permit To Lease and Use Forestry Areas (Izin Pinjam Pakai Kawasan Hutan / IPPKH) in Kangean Energy Indonesia Ltd.
The President also showed his support to the upstream oil and gas industry by enacting Presidential Instruction Number 2 of 2012 which instructed the related Ministers, Governers, and Regents to support upstream oil and gas activities in order to acvhieve increase of oil production of 1.01 million barrel per day in 2014. One of SKK Migas accomplishments in 2012 was handing over land compensation in order to fulfill certain obligations as stated in the Permit To Lease and Use Forestry Areas (Izin Pinjam Pakai Kawasan Hutan / IPPKH) in Kangean Energy Indonesia Ltd. contract area. A total of 58,88 Ha in Sepanjang Village, Sapeken Sub-district, Sumenep District, East Java Provence was was handed over as land compensation to fulfill certain obligations as stated in Minister of Forestry Regulation Number P.18/Menhut-II/2011 on Guidance Regarding Permit To Lease And Use Forestry Areas. The area was was handed over by BPMIGAS (now SKK Migas) Vice Chairman to the Director General of Planalogy, Ministry of Forestry. SKK Migas have also successfully completed land acquisition of 6,152 areas / parcels or 99.9% of Banyu Urip Projects total land needs of 6,158 areas / parcels. While the 6 other areas are still in process. Regarding land acquisition for EPC-1 and EPC-5, SKK Migas has sent a letter to the Bojonegoro Regent to find a solution to this problem. The Banyu Urip Project also faces difficulties in renting land in the Gayam Village. At this moment, discussions with relevant Regional-Owned Enterprise (BUMD) regarding this issue are still proceeding. Local villagers are also demanding the construction of a soccer field as compensation.
63
A. LAND ACQUISITION AND PERMITS
In addition to the Banyu Urip Project, there were still numerous issues in land acquisitions and permits inhibiting upstream oil and gas activities, such as:
ConocoPhillips (Grissik) Ltd., Musi Rawas District, South Sumatra
Local residents have blocked the access road to ConocoPhillips (Grissik) Ltd. production facility. This act was carried out after the Supreme Court ruling that awarded the plaintiffs land rights on roads used to access the facility. The location of the area is actually located in a forest and all necessary principal permits have been obtained from the Ministry of Forestry. Based on the prevailing regulations, PSC Contractors is obliged to give compensation for vegetation (and not for acquisition). Discussions with the plaintiffs have been held, although no settlements have been agreed upon. At present, the PSC Contractors and the Ministry of Forestry are preparing a lawsuit in the Musi Rawas District Court
PT. Sele Raya Merangin Dua, Musi Rawas District, South Sumatra
PT. Sele Raya Merangin Dua is experiencing problems regarding overlapping of land approximately 20 hectares with PT London Sumatra, a palm oil producer. As well as problems regarding overlapping of land with PT BSL, a coal mining company.
Joint Operating Body Pertamina PetroChina East Java (JOB PPEJ), Gresik District, East Java.
The gas well production facilities is located on land belonging to PT. Semen Gresik, a State-Owned Enterprise. Based on Law Number 2 of 2012, such location must be acquired. At this time, JOB-PPEJ is still in negotiations to initially rent and then acquire / transfer the land. Issues related to land acquistion are also experienced by other PSC Contractors, such as Genting Oil Kasuri Pte. Ltd.; Premier Oil Natuna Sea B. V.; and PT Chevron Pacific Indonesia
Besides the issues regarding land acquisition there are a number of other issues, in particular regarding IPPKH regulated in Minister of Forestry Regulation Number P18/Menhut-II/2011 and Minister of Forestry Regulation Number P38/Menhut-II/2012, among others:
Overlapping of PetroChina International Jabungs contract area with

PT Wira Karya Sakti land.
Overlapping of Kondur Petroleum S.A. (EMP Malacca Strait) dan Petroselats contract
areas with PT RAPPs land.
Overlapping of PetroChina International Jabung and Kalrez Petroleums contract areas

with third partys land (residents with land certificates located in the forestry area).
Overlapping of VICO Indonesias contract areas with forest conservation (Taman

Wisata Alam).
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SKK MIGAS
ANNUAL REPORT 2012
B.
SECURING NATIONAL VITAL OBJECTS
In 2012, 1,389 cases of security threats occured, this is 15% lower than last year of 1.633 cases.
Security threats to production facilities are one of the issues interfering in upstream oil and gas activities. In 2012, 1,389 cases of security threats occurred, this is 15% lower than last year of 1,633 cases. Of the 1,389 cases occurring in 2012, approximately 77% cases happened to 3 PSC Contractors, consisting of 629 cases to Chevron Indonesia (Sumatera & Kalimantan); 274 cases to PT Pertamina EP; and 163 cases to Medco Energy E&P Indonesia.
Security Threats to PSC Contractors in the Past 3 Years
1,800 1,600 1,400 1,200 1,000 800 Disruptions 600 400 200 2010 810
1,633 1,389
2011
2012
65
B. SECURING NATIONAL VITAL OBJECTS
Security Threats to PSC Contractors
5% 7.95%
809 Cases (61.29%)

BURGLARY / ROBBERY
66 Cases (5%)
MATERIAL DAMAGE
17.80% 61.29%
235 Cases (17.80%)

LAND MATTERS
53 Cases (4.02%)
PROTESTS
105 Cases (7.95%)

THREATS
52 Cases (3.94%)
OIL THEFT
A decline in the total number of security threats shows a change in PSC Contractors paradigm towards security. PSC Contractors are starting to see this aspect as an important function even from the planning phase. For example, PSC Contractors are now conducting security risk assessment to analyze the risks, important areas requiring official authorities, and essential security systems.
In 2012, SKK Migas held basic training on upstream oil and gas activities for the Regional Police in oil and gas areas.
In 2012, SKK Migas held basic training on upstream oil and gas activities for the Regional Police in order to give a better understanding that upstream oil and gas activities cannot be compared to common mining activities. This kind of training is essential in gaining a same perspective between all parties involved.
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ANNUAL REPORT 2012
Some PSC Contractors also established cooperation with the Police and Navy, based on a cooperation agreement between SKK Migas and the relevant authorities.
TITLE
PSC CONTRACTORS Exxonmobil Oil Indonesia Inc.
CONTRACT AREA
COOPERATION AGREEMENT WITH THE POLICE
Specific Safeguarding Operations of Oil and Gas National Vital Objects in the ExxonMobil Oil Indonesia Inc. Contract Area, Lhoksukon, Aceh Province.
Aceh Production Operation. North Sumatra Offshore Production Platform. Malikul Saleh Air Field and Lhoksukon.
Cooperation Agreement on Surveillance and Security for the Pertamina Hulu Energi Offshore North West Java Operational Area.
PHE ONWJ
Offshore North West Java - West Java
Security and fulfillment of facilities, logistics, equipment for the safeguarding of oil and gas national vital objects in the Mobil Cepu Ltd. Contract Area, Cepu Block, Bojonegoro and Tuban District - East Java.
Mobil Cepu Ltd (MCL)
Cepu Block, Bojonegoro and Tuban District, East Java
Cooperation Agreements on the Formation of a Joint Security Unit (Satuan Pelaksana Pengamanan Kerja Bersama / Satlakpamber) between SKK Migas and several Local Police, among others in Riau, South Sumatra, East Java, East Kalimantan, Papua, and Maluku.
COOPERATION AGREEMENT WITH THE NAVY
Cooperation Agreement on Naval Mine Sweeping in the Mobil Cepu Contract Area, Banyu Urip Block Offshore North Tuban, East Java
Mobil Cepu Ltd.
Offshore Java Sea, Banyu Urip Contract Area
Cooperation Agreement on Surveillance and Security for the Kangean Contract Area
Kangean Energy Indonesia
Kangean Contract Area, Pagerungan
Cooperation Agreement on Security and Protection for PHE WMO Oil and Gas Drilling Location in Offshore Java Sea, Bojonegoro and Tuban - East Java
PHE WMO
Offshore Java Sea
67
C. REGULATIONS
C.
REGULATIONS
In 2012, there are still issues in relation to regulations in the upstream oil and gas industry, among others are: 1. Law Number 11 of 2006 on the Government of Aceh The Governor of Aceh, through letter Number 540/46120 dated June 15th, 2010, declared that implementation of PSCs work programs after the enactment of Law Number 11 of 2006 is postponed until the Government c.q. Minister of EMR carries out the mandate stated in Law Number 11 of 2006, particularly the directive in managing natural resources in Aceh. As a result all upstream oil and gas activities in Aceh have been halted. Following this, the Governor of Aceh through letter Number 542/25706 dated August 11th, 2011 to the Minister of EMR, stated that in principal approve and agree on theimplementation of exploration activites by 4 PSC Contractors (East Seruway, South Block A, Andaman III, and West Glagah Kambuna) until the discovery of oil and gas reserves which can be commercially produced, if PSC Contractor fulfill the following:
a. Submit 1 copy of the PSC notarized by the Directorate General of Oil and Gas. b. Willing to amend the PSC between the exploration operator and BPMIGAS
Starting from Wednesday, January 25th, 2012, PSC Contractors are able to fulfill exploration commitments in Aceh in accordance with the agreed terms.
(now SKK Migas) in accordance with prevailing regulations.

c. POD can only be executed after an agreement between the Government and the
Aceh Government is met. Starting from Wednesday, January 25th, 2012, PSC Contractors are able to fulfill exploration commitments in Aceh in accordance with the terms of said letter.
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SKK MIGAS
ANNUAL REPORT 2012
2.
Government Regulation Number 79 of 2010 on Recoverable Operational Costs and Income Tax Treatment in the Upstream Oil and Gas Industries
SKK Migas and PSC Contractors in implementing the provisions of Government Regulation Number 79 of 2010 faces many issues due to the lack of clarity in some provisions and the lack of further regulations as mandated in the Government Regulation. To overcome such issues, in 2012 we have conducted a workshop inviting speakers from BPMIGAS (now SKK Migas), Directorate General of Tax, Directorate General of Oil and Gas, and Fiscal Policy Agency (Badan Kebijakan Fiskal / BKF); and attended by participants from BPMIGAS (now SKK Migas) and PSC Contractors. The goal of the workshop is to obtain the Governments (Directorate General of Tax, Directorate General of Oil and Gas, and BKF) inputs / views / directive in implementing the provisions of Government Regulation Number 79 of 2010 . In 2012, the Indonesian Government issues Government Regulation Number 14 of 2012 on Electric Power Supply Business Activities and Minister of EMR Regulation Number 29 of 2012 on Electric Power Plant Capacity for Own-Use Based on an Operation Permit which are the implementation regulation of certain articles in Law Number 30 of 2009. The regulations require all PSC Contractors to equip all electric power supplies, which so far is used for its own use and has the required certificates from the Director General of Oil and Gas (Sertifikat Kelayakan Penggunaan Peralatan Listrik dan Sertifikat Kelayakan Penggunaan Instalasi Listrik), with an operational license from the Minister, Governor, and/or Mayor.
3. Law Number 30 Year 2009 on Electricity
4. Law Number 32 of 2009 on Environmental Protection and Management
The non existence of implementing regulations for Law Number 32 of 2009 has caused differences in interpretation for many parties, including Ministries and Local Governments. The implementation of Governement Regulation Number 27 of 2012 on Environmental License was intended to facilitate all other licenses in the form of an environment protection and management license, but the fact remains that this license just adds to the bureaucratic chain. Moreover, the Ministry of Environmental Affairs could not technically accept Minister of EMR Regulation Number 045 of 2006 on Treatment of Drill Mud, Mud Waste, and Drill Cutting in Oil and Gas Activities, because it is considered contrary to Government Regulation Number 18 of 1999 on Toxic and Hazardous Waste Management, despite the flexibility given in Government Regulation Number 85 of 1999 on Amendment of Government Regulation Number 18 of 1999 on Toxic and Hazardous Waste Management.
69
D. OIL THEFT IN SOUTH SUMATRA
D.
317,801 barrels of oil were reported missing from the Tempino-Plaju pipeline in 2012.
OIL THEFT IN SOUTH SUMATRA
Throughout 2012, oil theft in the Tempino-Plaju pipeline extending for 265 km has been quite phenomenal. Theft in this pipeline belonging to Pertagas, a subsidiary of PT Pertamina, managed by PT Elnusa, has contributed to immense losses for the State. In the course of January-December 2012, 317,801 barrels of oil were reported missing from the Tempino-Plaju pipeline. It is estimated that State losses caused by the theft is about Rp300 billion, assuming the Indonesian crude oil price is US$100 per barrel with a currency exchange of Rp9.300/US$. The method of theivery that is usually utilized is illegal tapping, with a total of 810 incidents in 2012. This means every day a minimal of 2 incidents of illegal tapping occurs. Another method is sabotage, with a total of 96 incidents per year or 8 incidents per month; as well as pump blockage for 395 hours per year or 61 hours per month.
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SKK MIGAS
ANNUAL REPORT 2012
Distribution Graph 2012
450,000 400,000 350,000 300,000 250,000 350,382 307,188 320,889 325,667 354,316 369,012 371,353 403,482 377,225 369,739 392,437 200,000 150,000 415,085 17,958
345,295 311,624 316,861 318,737 314,895 303,315 355,157 348,224 353,379 381,329
374,479
305,505
BAREL
Pumping Losses Revenues
39,421
48,325
100,000 50,000 0 -50,000
63,507
68,038
29,001
Jan
-5,087
Feb
-4,436
Mar
4.028
Apr
6,930
May
Jun
Jul
Aug
Sep
Oct
16,360
Nov
Dec
Oil thefts reached its peak in July 2012. A decline in incidents occured after local law enforcement officials performed operations.
From field findings, we know that the method of thievery used is organized, grouped, located 200-400 meters from the tapping point, includes people from the Sub-district and informants, and even uses intimidation and threats to PSC Contractors security officers. Oil thefts reached its peak in July 2012. A decline in incidents occured after local law enforcement officials performed operations, however shortly after incidents of theft increased and has even caused loss of life. As many as 5 people died in a fire on kilometer 219 Bayung Lincir Sub-district, Musi Banyuasin District, South Sumatra caused by illegal tapping. The location of the fire is near the Tempino-Plaju pipeline.
33,756
71
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SKK MIGAS
ANNUAL REPORT 2012
IV
DEVELOPMENT AND MAJOR PROJECTS
73
IV. DEVELOPMENT AND MAJOR PROJECTS
A. BANYU URIP FIELD
SKK Migas and PSC Contractors are completing numerous major projects, which we anticipate will increase oil and gas production. Following are activities conducted in 2012 to realize said petroleum projects.
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SKK MIGAS
ANNUAL REPORT 2012
A.
Until the end of 2012, the Banyu Urip Project development progress has reached 37.5% (actual) from 38.9% (cumulative recovery plan) and 51.4% (contractual baseline).
BANYU URIP FIELD

The Banyu Urip Field development project by Mobil Cepu Limited (MCL) is located in the Bojonegoro and Tuban District (East Java). Development of the project started in Q4 2011 with the Ground breaking ceremony held on December 6th, 2011 by the Minister of EMR. First production started in September 2009 with early rented production facilities. By December 31st, 2012, Banyu Urip has produced an average of 24 MBOPD, while peak production of 165 MBOPD is planned for the end of 2014. In order for the Banyu Urip Project to able to reach peak production, we have divided the development into 5 EPCs (engineering, procurement, and construction), which are:
EPC-1 for production facilities (central processing facility and wellpads). EPC-2 for onshore oil pipeline (72 km). EPC-3 for offshore oil pipeline (23 km) and mooring tower. EPC-4 for FSO (Floating Storage Offloading) Gagak Rimang, with a 2 million barrel capacity. EPC-5 for infrastructure facilities, including raw water basin (reservoir for injection
water) with a 2.75 million m3 capacity. As well as those five EPCs, this project will also drill 42 new wells. Until the end of 2012, the Banyu Urip Project development progress has reached 37,.5% (actual) from 38.9% (cumulative recovery plan), and 51.4 % (contractual baseline), with the progress for each EPC as follows: PROJECT
CONTRACTOR Plan EPC - 1 EPC - 2 EPC - 3 EPC - 4 EPC - 5 Tripatra - Samsung IKPT - Kelsri Rekayasa Industri - LIKPIN Scorpa Pranedya - Sembawang Rekayasa Industri Hutama Karya 39.4 51.3 32.7 40.6 31.9 % PROGRESS Realization 40.9 42.2 25.4 38.1 23.1
The progress of EPC-1 has exceeded the target set, while delays of several permits from Government institutions and lack of educated and non-educated manpower have caused the development progress of the other EPCs to become lower than planned.
EPC1: Wellpad B & CPF
EPC2:
EPC3:
EPC4:
EPC5:
Drilling:
Pipeline Installation
FBE Coating Process
FSO Gagak Rimang Conversion
Soil Excavation in the Water Basin
Rig DS # 8 Fabrication
75
B. INDONESIAN DEEPWATER DEVELOPMENT (IDD)
B.
INDONESIAN DEEPWATER DEVELOPMENT (IDD)

Chevron Indonesia Companys Indonesian Deepwater Development (IDD) Project is an integrated development project of 5 deepwater gas fields (between 975m 1,785m) to fulfill domestic and export gas demands, which are Gendalo, Maha, Gandang, Gehem, and Bangka Fields. Initial delivery of gas to consumers is planned from Bangka Field in Q1 2015 with a flow of 120 MMSCFD of gas and 2.88 MBCPD of condensates. Peak production will occur in 2017 with 924 MMSCFD of gas and 23 MBCPD of condensates from Gendalo Hub and Gehem Hub. The scope of the IDD project consists of development of the Bangka Field, Gendalo Hub, and Gehem Hub.
Singapore
Brunei
Kutai Basin Bontang LNG Plant

Malaysia
,
Indonesia
Santan Terminal
120 MMSCFD
West Seno Hub (Existing) (1,015 WD) West Seno Hub Pipeline
Chevrons Balikpapan Office and Camp Senipah Terminal
East Kalimantan Pipeline Network
420 MMSCFD 30.000 BCPD
Gehem Hub
Bangka Field (975m WD)
Gehem Export Pipelines Gehem FPU (1,785 WD) Gendalo Export Pipelines
700 MMSCFD 25,000 BCPD
Gendalo Hub
Lapangan Gehem (1,765 WD)
Gendalo FPU (1,170m WD) Gendang Field (1,715m WD) Gendalo Field (1,570m WD)
Maha Field (1,060m WD)
KUTAI BASIN
Gendalo Hub Gehem Hub Bangka Subsea Tieback
The development of the Bangka Field will utilize West Seno FPU with specific modifications to accommodate production of 120 MMSCFD of gas, 4 MBCPD of condensates, and 150 BWPD of produced water. As well as, development and installment of 2 subsea wellheads, associated manifolds, subsea accessories, and flowlines. Gas and condensate production will be sent to Santan terminal and then flowed to Bontang LNG Plant.
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SKK MIGAS
ANNUAL REPORT 2012
Indonesian Deepwater Development Project is an integrated development project of five deepwater gas fields, which are Gendalo, Maha, Gandang, Gehem, and Bangka.
Gendalo Hub is a production facility established to develop the Gendalo, Maha, and Gandang Field, consisting of the installation of 15 subsea wellheads, associated manifolds, and flowlines from subsea systems to Gendalo Floating Production Unit (FPU), as a central processing unit with a capacity of 700 MMSCFD of gas, 20 MBCPD of condensates, 8 MBWPD of produced water, and the installment of 2 gas and condensate trunklines, 150 km each, from Gendalo FPU to Santan Terminal. Gehem Hub is a production facility established to develop the Gehem Field, consisting of the installation of 11 subsea wellheads, associated manifolds, and flowlines from subsea systems to Gehem FPU, as a central processing unit with a capacity of 420 MMSCFD of gas, 27 MBCPD of condensates, 1 MBWPD of produced water, and the installment of 2 gas and condensate trunklines, 88 km each, from Gehem FPU to Santan Terminal.
SANTAN TERMINAL
BONTANG
SANTAN TERMINAL
BONTANG
SANTAN TERMINAL
BONTANG
G 20
140 km FPU
C 8
78 km
Gehem Local FPU
G 16 C 8
Export Pipelines
West Seno FPU
Existing West Seno TLP
Maha
Gandang Gehem FPU
Gendalo
Bangka
GENDALO HUB
GEHEM HUB
BANGKA
In 2012, the FEED for FPU, subsea umbilical riser flowline (SURF), export pipeline, and onshore receiving facility (ORF) were completed. Based on the FEED result, the next step is the procurement of an EPCI Contractor to develop SURF and ORF. Furthermore, the AMDAL permits were also approved by the Ministry of Environment in 2012.
77
C. ABADI FIELD
C.
Abadi Field development in the Masela Contract Area by Inpex Masela Ltd. is a series of activities consisting of the development of a production facility, namely Floating LNG and SURF, drilling and logistic supply base (LSB).
ABADI FIELD
The activities conducted in 2012 were:
a. Approval of the Multi FEED FLNG tender winner to 2 contractors, which are Saipem
Consortium and JGC Consortium, with a schedule of 13 months.

b. Approval of the FEED SURF tender winner to PT Wood Group Indonesia, with a
schedule of 12 months.
c. Finalizing the tender package for a mobile offshore drilling unit (MODU) to drill
3 delineation wells (Abadi-8, Abadi-9, Abadi-10) and 1 exploration well (Berkat-1) as well as approval of the initial full field development, consisting of subsea pipeline survey and further development studies. One of the obstacles that Inpex and SKK Migas face in establishing the EPCI tender assessment criteria is determining the cost of the project and the minimum level of local content (TKDN) used. Considering that the contract area is located in a frontier area, Inpex and SKK Migas also coordinated with the Ministry of Defense to discuss the location of the logistic supply base. Inpex, SKK Migas, and the Regional Government of Maluku are still in discussions regarding recruitment of local manpower. Furthermore, Inpex is still waiting for the decision of the Regional Government in relation to its desire to be included in the management of the field.
PSC Terms & Conditions: Contract Period : November 1998 - November 2028 Exploration Period : November 1998 - November 2008 Operation Period : November 2008 - November 2028 Profit Split : 65% / 35% (Oil) & 60% / 40% (Gas) FTP 15%; DMO 25%; Tax 44%
Aru Island (600km from Abadi) Tanimbar Island (150km from Abadi)
Dili
East Timor Timor Trough

Sunrise Bayu - Undan Evans Shoal Evans Shoal South
ABADI
Sarossa Caldita
Tanimbar Island Saumlaki
Indonesia
Timor Sea
Australia
Tassie Shoal (150km from Abadi)
Petrel
Darwin
Gas Reserves 6-9 TCF Development Plans for a Floating LNG 2,5 MTPA Investment Costs US$5.0 Billion Start of Production 2017 for 30 Years
200 Km
Tem Blacktip
78
SKK MIGAS
ANNUAL REPORT 2012
D.
The Jangkrik Project developed by eni Muara Bakau B.V. to produce reserves of 913 BCF of gas and 739 thousand barrel of condensates from the Jangkrik-1, Jangkrik-2Dir & Jangkrik-2DirA, and Jangkrik-4 exploration wells, as well as Jangkrik NE-1 on July 2011. The Jangkrik and Jangkrik NE Field is located in the Kutai Basin, approximately 70 km offshore East Kalimantan.
JANGKRIK & JANGKRIK NORTH EAST (JNE) FIELD

The combined development of Jangkrik North East and Jangkrik Field increased the economy of those two fields to better profit the Nation. The first POD for the Jangkrik Field was approved on November 2011, while the second POD (POD II) for the Jangkrik North East Field is still being evaluated by SKK Migas. The Jangkrik and Jangkrik North East Field Project will encompass the development of a subsea production system (wellhead, pipeline, manifold, and umbilical), a Facility Production Unit with a capacity to process 450 MMSCFD of gas, a transfer and utility system, as well as an export system for condensates and gas. The drilling development program in Jangkrik Field will consist of workovers on 3 existing wells and 4 new wells. Meanhile a subsea production system will be developed, consisting of 7 wellheads, 3 manifolds, as well as a flexible flowline and risers. 2 pipelines (80 km) with a diameter of 20 for gas and 4.5 for condensates will be built to transport the production from the Jangkrik and Jangkrik North East Fields to the East Kalimantan Pipeline System, which in turn will transport the gas to Badak LNG Plant and the condensates to Senipah Terminal. The development of the subsea production system and FPU will utilize a combined FEED and EPCI contract. Since August 2012, the FEED for FPU has started, and it is projected that the FEED for the subsea production system can start in early 2013. The expectation for first delivery of gas to consumers shall start in November 2015.
Manifold NE1 42 to Bontang LNG Plant 20 to Senipah Sapi Plant

FL OW LIN ES
JKK-1 JKK-4
Manifold NE2 JKK-2 JKK-3 JANGKRIK NORTH EAST JKK-5 Cluster 2 EP-3 FPU JKK-3 JKK-2
PIP
ELIN
YBA
CK)
EPCI-2 Cluster 3 EPCI-1 JKK-7 Cluster 1 JKK-1 JKK-6 JKK-4 JANGKRIK MAIN
Gas & Condensates Export to Shore
25
KM
GAS
LIN
E (P
IGG
JANGKRIK BARGE FPU
KM
Senipah Plant
80
EP
IPE
MU
DEN
SAT
LT IP
80
KM
CON
HA
SE
Onshore Receiving Station
JANGKRIK
JANGKRIK NE
79
E. BUKIT TUA FIELD
E.
At this moment Petronas Carigali Ketapang II Ltd. (PCK2L) is developing the Bukit Tua Field in the Ketapang Contract Area, East Java. The Bukit Tua field is an oil field with some associated gas, located 35 km north of Madura Island and 110 km northeast of the Gresik sea with a water depth of less than 57 meters.
BUKIT TUA FIELD

The first POD for the Bukit tua Field was approved on July 9 th, 2008 with an estimated cumulative production of 22.8 MMBO and 70 BCFG for 5 years. A 20 MBOPD dan 70 MMSCFD capacity production facility will be built, consisting of un-manned well head platform (WHP) with 5 production wells and 1 injection well (as a contingency), which will be connected to a spread-moored floating production storage and offloading (FPSO). Gas will be transported through a 110 km 12 export pipeline to an ORF in Gresik, while oil will be exported with a tandem mooring from the FPSO and the produced water will be managed for sea disposal. The gas sales purchase agreement (GSPA) was signed on April 13th, 2012, where it was agreed that the gas will be sold to PT. Petrogas Jatim Utama to then be transported through a 23 km pipeline to PT. Pembangkit Jawa Bali. This project is anticipated to be onstream in November 2014.
KETAPANG CONTRACT AREA
BUKIT TUA FIELD
LAMONGAN MADURA ISLAND GRESIK SURABAYA
EAST JAVA
Onshore Receiving Facility ORF Located around 4.7 ha from Gresik, East Java (location: Maspion Industrial Estate) A maximum capacity of 70 MMSCFD Main Equipment: Pipeline Pig Receiver, Inlet Separation & Sales Gas Metering Package
Wellhead Platform (WHP): - 9 slots - 3 Legged Jacket - 57m water depth Infield Flow Line (700m): - 1x8 liquid - 1x16 wet gas - 1x12 export gas
FPSO or Converted FPSO (leased): - Crude Oil Processing Storage - Gas Compressor - Spread Moored - TEG Dehydration
12 Export Gas Pipeline Approx. 110km Shore Line PLEM Flexible Risers: - 1x8 liquid line - 1x16 wet gas line - 1x12 export gas line Bukit Tua ORF Interconnecting Pipeline by PT PJU +/- 23km PTPJB POWER PLANT - Tandem offloading - Export by floating hose
PCK2L
PJU
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SKK MIGAS
ANNUAL REPORT 2012
F.
The Ande Ande Lumut (AAL) Field operated by AWE (Northwest Natuna) Pte. Ltd. is the first commercial field developed in the Northwest Natuna contract area.
ANDE ANDE LUMUT FIELD

The Ande Ande Lumut field is anticipated to produce approximately 43.5 MMBO (economic limit) from a reserve amounting to 62,7 MMBO (90% P1 + 50% P2). It is hoped that initial production of 5 MBOPD of oil can be achieved by Q4-2014, with a peak production of 25 MBOPD. The development of the Ande Ande Lumut Field consists of drilling of 43 development wells, construction and installation of 1 WHP, as well as leasing an FPSO. By the end of December 2012, the Ande Ande Lumut Field development has reached the procurement stage for the FPSO and the FEED for the FPSO and WHP.
Ande Ande Lumut Oil Discovery NORTHWEST NATUNA Oil Field Gas Field
LOKASI
Br i
dge
Wellhead Platform (43 Wells) FPSO with spread mooring To Shuttle Tank AAL-2 AAL-3 AAL-1
Water Depth 73m
Reservoir Depth 1.100m subsea
Field Area : 21 km2
81
G. NORTH DURI DEVELOPMENT AREA-13 (NDD AREA-13)
G.
The POD for Area-13 was approved in March 16th, 2011 to produce 31 MMBO from the North Duri Area through 358 production wells, utilizing steam flooding.
NORTH DURI DEVELOPMENT AREA-13 (NDD AREA-13)

The North Duri Field operated by PT. Chevron Pacific Indonesia is located in Duri (Rokan contract area, Riau) and is part of the Duri Steam Flood. NDD Area-13 is part of North Duri Fields revised POD, where it is stated that the North Duri Field consists of Area-12, Area-13, and Area-14. NDD Area-12 has been in production from November 2008, the next step is the development of NDD Area-13. It is estimated that the NDD Area-13 will be onstream on December 2013, with a production period of 2013 until 2021. The production peak rate is anticipated to reach 17 MBOPD of oil in 2017 and will then decline naturally until the end of 2021. The scope of the NDD Area-13 project are: 1. Drilling of 358 production wells, 145 injection wells, and 26 observation wells. 2. Construction of wellpads for 539 wells, roads, and drainages. 3. Construction of production gathering flowlines, steam injection lines, casing vapor collection (CVC) station, and automated well test (AWT) station. The EPCI project for NDD Area-13 began in July 9th, 2012 with PT. Wijaya Karya PT. Inhwa Indonesia - PT. Singgar Mulia Consortium as contractor.
14 12
Duri Undeveloped Area
13
11
Minas
9
17 Km
10 8 4 3 1 7
8 Km
5 2 6
Developed by Steam Flood
Construction Review Meeting, Duri 17-18 Dec 2012
Living IIF In Action Training for EPC Contractor Employees, Duri 26 Dec 2012
Fencing Installation at J3 Office
Clearing & Grubbing, Road G-4.1
Clearing & Grubbing, Wellpad Road G5-1
Excavation Work at Secondary Canal 12A
82
SKK MIGAS
ANNUAL REPORT 2012
H.
The Corridor contract area is operated by ConocoPhillips (Grissik) Ltd. with the initial discovery of Rawa Field in 1985. Other exploration activities up to 1998 have successfully found 6 additional fields. With the discovery of those 7 fields, the Corridor contract area has successfully produced oil and condensates with a maximum flow of 10 MBOPD of oil and more than 1 billion SCFD of gas.
CORRIDOR BLOCK DEVELOPMENT PROJECT

Production from this contract area is derived from the Suban, Dayung, Sumpal, Letang / Tengah, Gelam, Sambar, and Rawa Fields. In 2010, ConocoPhillips (Grissik) Ltd., proposed an investment initiative to increase production from the Corridor contract area, namely the Dayung Compression 1 Project, the Sumpal Expansion Project, and the Grissik Debottlenecking Project. Sumpal Expansion Project The Sumpal Field is one of eight gas fields located in the Corridor contract area, and has been in production since 2001 with a capacity of 155 MMSCFD of dry gas transported to the Central Grissik Plant (CGP) by pipelines. The Sumpal Expansion Project adds a second train to the Sumpal Station by constructing and installing a gas dehydration and cooling system, to increase the Sumpal Gas Station capacity to 2x155 MMSCFD. In detail, the scope of the Sumpal Expansion Project consists of the installation of the second train with a 155 MMSCFD capacity, a gas cooling, glycol dehydration, a produced water system, in addition to an electrical and control system. Moreover, to increase the gas transportation capacity from the Sumpal Station, a 16 trunkline was built to the Sumpal Junction. It is estimated that the second train will be operational in September 2013. In December 2012, this project is still in construction, and we expect onstream to take place by September 2013.
CORRIDOR BLOCK
Gas Sales Pipeline (TGI) to Chevron Duri
Gas Sales Pipeline (TGI) to Singapore
530 km, 28
PALEMBANG
545 km, 28
GELAM PLANT
FIELD DISCOVERY Rawa/S Rawa 1985 Latang/Tengah 1986 Gelam 1990 Sambar 1991 Dayung` 1991 Sumpal 1994 Suban 1998
SOUTH SUMATRA SUMPAL PLANT DAYUNG PLANT
5 km, 16
30 km, 12
GRESIK CENTRAL GAS PLANT

43 km, 26
DAYUNG
50 km, 12
SUBAN PLANT
SAMBAR
13 km, 24 35 km, 28
TENGAH
71 km, 26
13 km, 6
RAWA
LETANG
RAMBA
LETANG
LEGEND COPI GA P/L THIRD PARTY P/L FUTURE P/L

10 km, 10 649 km, 32-36
Gas Sales Pipeline (PGN) to West Java
83
H. CORRIDOR BLOCK DEVELOPMENT PROJECT
Dayung Compression Project The Dayung Compression Project was initiated to ensure the transportation level of gas to Caltex contracts and any further contracts (Caltex 3) with a raw gas transport capacity of 200 MMSCFD. The scope of the Dayung Compression Project consists of the development and installation of a 24 HP gas compressor, development of a produced water system and a backup electricity system. It is estimated that this project will come to an end in September 2013, with an initial production of 97 billion BTUD and will reach peak production in 2014 with 180 billion BTUD.
Grissik Debottlenecking Project The Grissik Debottlenecking Project is a project that will increase the gas prufication capacity of the Grissik Plant, especially the high-CO2 system, from 310 MMSCFD of raw gaw to 460 MMSCFD of raw gas to accomodate additional delivery of gas from Sumpal and Dayung Fields. The scope of this project consists of the development and installation of a Regen Gas Compression with a 2x26 MMSCFD capacity, an extra CO2 separation system, instruments, and a generator. The schedule for project completion is September 2013, coinciding with the completion of the Sumpal Expansion and Dayung Compression projects.
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SKK MIGAS
ANNUAL REPORT 2012
I.
The Ruby Field, an offshore gas field, is part of the Sebuku contract area operated by PearlOil (Sebuku) Ltd.
RUBY FIELD DEVELOPMENT PROJECT

The Ruby Field was developed to produce approximately 214 BCF of gas with a flow of up to 100 MMSCFD of gas in 4 years, produced from 6 development wells from the Berai Formation. The development concept of this field is the development of an integrated process system consisting of 6 WHP slots connected by a bridge to a Process & Quarters Platform (PQP) located in offshore deepsea with a waterdepth of 60 meters. Processed gas and condesates will be transported through 14 export pipelines for 312 km to the Senipah Terminal operated by Total E&P Indonesie. The gas will then by transported to PT. Pupuk Kalimantan Timur through the East Kalimantan gas pipeline system. The Ruby Field project progress until the end of 2012 is the completion of pipelines from the Ruby Field to the Senipah Terminal. The WHP and PQP is in fabrication in Batam and Balikpapan. The project is expected to be onstream by September 2013.
SENIPAH TERMINAL
31 2
KM
14 P
IP
EL
IN
E
RUBY FIELD
85
J. KEPODANG FIELD
J.
The Kepodang Field first POD (POD I) was approved in June 20th, 2005, however in its development several revisions were enacted causing the initial upstream scheme to be altered to a downstream scheme. The Kepodang Field POD I revision was signed on May 14th, 2012 to produce 365 BCF of cumulative gas with a flow rate of 116 MMSCFD of gas for 12 years.
KEPODANG FIELD
The Kepodang Field is operated by PC Muriah Ltd. in a waterdepth of 60-70 meters from sea level and located around 180 km northeast of Semarang, the capital of Central Java. The Kepodang Field development consist of 2 stages: 1. Stage 1 development of 6 wells and installation of: Central Processing Platform (CPP), consisting of a process deck with separation, dehydration, compression, utilities, and wellhead module (WHM-A), with 8 slots / 4 wells. CPP is an unmanned platform controlled from the ORF. 1 wellhead tower (WHT-C), with 5 slots / 2 wells connected to the CPP by 2.7 km 10 infield pipe. Stage 1, will also develop an Onshore Receiving Facility (ORF) and a 200 km 14 export gas pipeline from CPP to ORF, which will be built and operated by a third party based on the downstream scheme.
2. Stage 2 development of WHT-D installation with 2 wells connected to the CPP and an additional 2 wells drilled, each in WHT-C and CPP. The Kepodang gas reserve is used to supply the Tambak Lorok Gas and Steam Power Plant (PLTGU) operated by PT Indonesia Power (PTIP) located in Semarang.
Java Sea
In 2012, several procurement processes were completed, which set in motion the fabrication phase in 2013.The Kepodang Field development project is set to be onstream on October 2014.
Kepodang Development Concept
Business Scheme Comparison between Approved POD (2005) and Proposed POD Revision (2011)
POD Scheme Current Business Scheme (Export Pipeline & ORF Downstream)
Central Processing Platform (CPP)

Phase 2 DN150 (6ND) 4.7 Km Flowline
Unmanned CPP
DNS250 (10ND) 2.7 Km Flowline 14 x 200 km Export Pipeline
PCML built and own Offshore Facilities
Unmanned CPP New offshore gas matering UPSTREAM DOWNSTREAM 14 x 200 km Export Pipeline by Transporter
Phase 1 Development Phase 2 Development WHT-C DN350 (14ND) 200 Km Export Pipeline: by Transporter
All Facilities and Pipeline by PCML
Onshore Receiving Facilities (ORF):

Transporter will build and own Control Building in ORF, PCML will lease the 2nd Floor for its Operations ORF Inside PTIP Area ORF Inside PTIP Area
Transporter will build and own Control Building in ORF, PCML will lease the 2nd Floor for its Operations
ORF Inside PTIP Area
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SKK MIGAS
ANNUAL REPORT 2012
K.
The integrated development of the Senoro gas field and the Matindok gas field is carried out to fulfill the needs of the Donggi Senoro LNG plant with a capacity of 2,5 MTPA.
SENORO GAS FIELD INTEGRATED DEVELOPMENT AND MATINDOK

In addition, the development of this field also aims to meet the domestic gas needs of power stations and fertilizer plants.
Tangkiang
Bakiriang Reservation Area SNR-2 SNR-3
Nonong SNR-1
Peleng Strait
The integrated project and commercial scheme can be seen in the chart below.
Donggi Pertamina EP DONGGI CPP Minahaki Senoro

50MMSCFD 335MMSCFD
LNG PLANT
Business Scheme Downstream LNG Gas Supply: Matindok Area: 85 MMSCFD Senoro Area: 250 MMSCFD
JOB P-MTS
310MMSCFD
SENORO CPP Cendanapura
TIP 1
25MMSCFD
PLN
55MMSCFD
Maleoraja
FERTILIZER
Pertamina EP MATINDOK CPP

55MMSCFD
GSA TIP 2
Domestik Electricity, Gas Supply: Matindok Area: 20 MMSCFD Senoro Area: 5 MMSCFD Fertilizer, Gas Supply: Senoro Area: 55 MMSCFD
Matindok
The Senoro Field Gas Development - JOB Pertamina Medco Tomori Sulawesi
The Senoro Field is located in the northeastern part of the Senoro-Toili contract area, discovered by the Senoro-1 exploration well in April 1999. The Senoro Field produces 310 MMSCFD of gas per day with 55 MMSCFD allocated to PT. Panca Amara Utama, 5 MMSCFD allocated for PT. PLN, and the rest sent to the Donggi Senoro LNG.
Operator: PT DSLNG
Senoro Toili Block Operator : JOB Pertamina - Medco E&P, Tomori Sulawesi Upstream Downstream
87
K. SENORO GAS FIELD INTEGRATED DEVELOPMENT AND MATINDOK AREA
The scope of development consists of 5 workover wells, 16 development wells, construction of a production facility to process 2x155 MMSCFD of gas, and the construction of a 27 km 30 gas pipeline to PT DS LNGS and a jetty terminal for condensates. Up to the end of 2012, this project has entered into the construction phase started in September 2012, it is estimated that gas production from the Senoro Field wll start in Q4-2012 with 300 MMSCFD of gas.
MATINDOK AREA LOCATION MAP

Ga sP ipa lin e
LUWUK
Peleng Strait
AMPANA
MALEO RAJA MATINDOK
RANGKONG A-1
Bakiriang Reservation Area
CI=5-2w CI=1-3w CI=2-9w CPP Jetty
SUKAMAJU MINAHAKI SULAWESI DONGGI MAL EO BESAR-1 MAL EO-1 PELENG
Senoro CI=5-2w CP=2 CI=3-5w
Onshore field for LNG Onshore field for IPP Dry exploration well
CP=1
The Matindok Field Gas Development Pertamina EP
The Matindok Field Gas Development is based on a gas discovery in the Matindok area from Donggi, Matindok, Maleoraja, Minahaki, Sukamaju, dan Mentawa Fields. The Matindok Fields total reserves is 852,.75 BCF with 105 MMSCFD allocated for gas sales. From the 105 MMSCFD of gas, 85 MMSCFD will be transported to Donggi Senoro LNG, while the rest (20 MMSCFD) will be transported to PT. PLN. The scope of development consists of construction of Donggi Field production facilities with a 60 MMSCFD capacity, which will process gas from the Donggi and Minahaki Fields. The Matindok Field production facilities with a 65 MMSCFD capacity will be used to process gas from the Matindok and Maleoraja Fields. A gross production of 56 MMSCFD will increase to 115 MMSCFD in mid 2015 for 12 years, after that production will decrease until reaching the abandonment phase in 20 years. The production of condensates will begin at the same time as gas production with 82 BCPD and will hit peak production in 2015 with 643 BCPD. The condensate volume during gas sales is 2.47 million BBL. The production from the Matindok area will merge with gas from the Senoro Field in Tie-in Point 1 and Tie-in Point 2, while the condensates produced from both facilities will be transported to a production facility in the Senoro Field. In the end of 2012, this projects has entered into the EPCI phase with a production target of Q4-2014.
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SKK MIGAS
ANNUAL REPORT 2012
L.
TRAIN 3 TANGGUH EXPANSION PROJECT

The Government approved BP Berau Ltd. plans for Train 3 Tangguh expansion project (POD II) on November 29th, 2012. This project in a continuation of Train 1 and Train 2 (POD I) which has been in operation since 2009. The Train 3 Tangguh expansion is planned to produce 2.48 TCF (nett sales gas). The production allocation of LNG produced from Train 3 Tangguh is for domestic (40%), and the rest of for buyers with the highest price and best economics. Initial gas production for commissioning of Train 3 Tangguh plant is at the end of 2018, while first production for delivery to LNG plants and Bintuni electricity is at Q2-2019. An LNG Plant will be built with a capacity of 3.8 MTPA and 3,200 BPD condensates and ORF. Upstream is the Gas Production Facility (Offshore) with a 700 MMSFD capacity consisting of 2 platforms with 7 wells and gas flowlines to LNG Plant with a 24 diameter for 24 km.
Tangguh Expansion Scope Schematic
WDP ONSHORE GAS PRODUCTION FACILITIES
VRD PLATFORM VRA PLATFORM VRB PLATFORM
O2
4-
15
km
O2 4-8 ,3
- 19 km
Bintuni Bay West Papua

OFA PLATFORM
ROA PLATFORM
8, 2 km
O 24
O2
4-
18
VRF PLATFORM
km
km
24
-1
O 24 O 24 -1 3,5 km
6,3 km
WDA PLATFORM
VRC PLATFORM
LNG JETTY
LEGEND
Offshore Onshore
LING COMBO JETTY

LNG Tank 1&2 LNG Tank 3 DRF T3 ORF T1&T2
Initial Development Phase Facilities Further Development Phase Facilities Existing Facilities Existing Pipeline
LNG T 3
COMBO DOCK
Proposed Pipeline
LNG T1&2
In the end of 2012, the Tangguh Expansion Project Train 3 is still in the initial FEED procurement phase.
New TRAIN - 3 & Utilities
89
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SKK MIGAS
ANNUAL REPORT 2012
NATIONAL CAPACITY EMPOWERMENT
91
V. NATIONAL CAPACITY EMPOWERMENT
A. UTILIZATION OF DOMESTIC GOODS AND SERVICES
A.
18,000 16,000 14,000
UTILIZATION OF DOMESTIC GOODS AND SERVICES

From January-December 2012, the total commitment for goods and services approved by BPMIGAS (now SKK Migas) and procured by PSC Contractors is US$16.61 billion with 60.04% local content (TKDN).
100% 90% 80% 63% 54% 43% 5,862 43% 6,568 4,737 3,577 995 2006 1,846 2007 1,400 2008 2009 2010 2011 2012 3,811 3,706 49% 5,408 5,082 6,976 61% 60% 70% 60% 8,109 11,531 50% 40% 30% 20% 10% 0
Services Goods % Local Content
12,000 10,000 8,000 6,000 Million US$ 4,000 2,000 0
SKK Migas encourages the use of local content (TKDN) as to maintain a minimal percentage of 60%. Supervision of this commitment is conducted through the AFE approval mechanism. Utilization of National-Flag Ship Of the total 654 ships needed, 97% are national-flag ships, while foreign-flag ships are mostly for drilling, such as jack up rig, drilling ship, and semi submersible rig, of which there are a limited number around the world. From 2010 until 2012, the use of local content in procuring goods / services involving State-Owned Enterprises (Badan Usaha Milik Negara / BUMN) has reached US$2.5 billion with an average local content (TKDN) of 74.16%. We hope that State-Owned Enterprises participation can be improved in the future and as such also increases local content (TKDN).
State-Owned Enterprises (BUMN) Participation in Goods / Services From 2010 Until 2012
State-Owned Enterprises (BUMN) Participation
2,000 1,699.59 1,500
1,000 629.13 Million US$ 500 197.28 2010 2011 2012
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SKK MIGAS
ANNUAL REPORT 2012
State-Owned Enterprises in the Upstream Oil and Gas Industry
NO
State-Owned Companies
TOTAL Amount (Thousand US$) Local Content (%) 64.38 96.30 68.13 76.32 93.73 78.95 96.76 83.35 60.93 92.27 74.87 31.79 95.42 86.53 74.87 74.16
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
PT. PAL Indonesia (Persero) PT. Adhi Karya (Persero) PT. Pertamina (Persero) PT. Pelayaran Nasional Indonesia (Persero) PT. Pembangunan Perumahan Tbk. PT. Sucofindo PT. Surveyor Indonesia PT. Hutama Karya (Persero) PT. Wijaya Karya (Persero) Tbk PT. Dahana (Persero) PT. Telekomunikasi Indonesia Tbk. PT. Asuransi Jasa Indonesia PT. Biro Klasifikasi Indonesia PT. Rekayasa Industri PT. Elnusa TOTAL
178,751.86 24,599.65 1,167,312.67 3,464.05 6,336.96 33,113.28 64,516.02 95,584.58 177,326.73 7,642.75 3,113.39 79,050.13 1,318.02 663,147.55 12,682.20 2,517,959.83
Efficiency of Joint Procurement
Coordination between BPMIGAS (now SKK Migas) and PSC Contractors regarding joint procurement, has enabled us to safeguard budget efficiency in the upstream oil and gas industry. In 2012 we targeted a savings of US$125 million with a realization of US$147.96 million.
Target Achievement
160 140 120 100 80 60 Million US$ 40 20 0 2009 2010 2011 33.2 20 70.9 50 80 103.5
147.96 125
2012
93
B. OPTIMIZING ASSET MANAGEMENT IN 2012
B.
Achievement Target
50 45 40 35 30 25 20 15 Million US$ 10 5 0
OPTIMIZING ASSET MANAGEMENT IN 2012

Since 2009, procurement efficiencies through optimizing assets and its realization always exceed the target. In 2012, optimizing of assets reached US$43 million, higher than the set target of US$30 million.
40 37 28
43
30 25 15 25
* December 31st, 2012 Status awaiting final recapitulation
2009
2010
2011
2012*
From the 55 special terminals operated, 72.7% is managed by PSC Contractors themselves to increase operating costs efficiency.
Since 2009, procurement efficiencies through optimizing assets and its realization always exceed the target.
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SKK MIGAS
ANNUAL REPORT 2012
C.
Yearly Transaction Commitments
10,000 8,000
PROCUREMENT TRANSACTIONS THROUGH STATE-OWNED / REGIONAL-OWNED BANKS

Since 2009, BPMIGAS (now SKK Migas) is committed to boost State-Owned Banks / Regional-Owned Banks / Syariah Banks. A few of the banks involved in procurement transactions are : Bank Mandiri, BRI, BNI, as well as a combination of Bank Mandiri / BNI, Bank Mandiri and BRI, Bank Syariah Mandiri and Bank Muamalat, and also other Regional-Owned Banks. The total value of procurement transactions from April 2009 until December 2012 is US$24.28 billion.
9,337.90
6,348.63 6,000 3,969.90 4,626.21
4,000 Billion US%
2,000
0 2009 2010 2011 2012
Transaction Commitments April 2009 until December 2012 (Million US$)
7%
$17,809.01 (74%)
MANDIRI
$522.35 (2%)
MANDIRI / BNI
15%
$3,670.02 (15%)
BNI
$16.29 (0%)
MANDIRI & BRI
$1,735.39 (7%)
BRI
$5.82 (0%)
MUAMALAT
74%
$491.29 (2%)
SYARIAH MANDIRI
$32.24 (0%)
REGIONAL OWNED BANKS
95
D. NATIONAL CAPACITY BUILDING (NCB) MANAGEMENT
D.
NATIONAL CAPACITY BUILDING (NCB) MANAGEMENT
SKK Migas commits to continuously increase the capacity and competency of the Indonesian Worker (Tenaga Kerja Indonesia / TKI) through the National Capacity Building (NCB) program. The NCB program aims to accelerate the Indonesian Workers competency in the petrotechnical and relevant technical fields, and to fulfill the demand for petrotechnical and relevant technical professionals to support the national upstream oil and gas industry. SKK Migas encourages PSC Contractors to improve the Indonesian Workers competency through international exposure by means of:
Technical Development Exchange (TDE) Program, Job Assignment / On The Job Training, Job Swapping, and Internationalization. SKK Migas commits to continuously increase the capacity and competence of the Indonesian Worker (TKI) through the National Capacity Building (NCB) program.
As a form of PSC Contractors commitment towards the development of Indonesian Workers, up to 2008 there has been an upwards trend in international assignments of Indonesian Workers. However after 2008, international assignments declined due to reduced available position overseas and the heightened domestic needs caused by major projects (Banyu Urip, IDD, Masela, Muara Bakau, and Tangguh).
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SKK MIGAS
ANNUAL REPORT 2012
As part of the NCB program, SKK Migas implemented a program with national educational institutions by means of a working partnership with a number of universities, such as ITB, University of Indonesia, Trisakti University and others.
As part of the NCB program, SKK Migas implemented a program with national educational institutions by means of a working partnership with a number of universities, such as ITB, University of Indonesia, Trisakti University, and others. The benefits to be derived from the NCB program, among others, is to increase the national capacity potential, to create a synergy between universities, to encourage universities to work together in creating ready-to-use graduates for PSC Contractors through a tailor-made program, as well as empower universities / education and training centers (Pusdiklat) as a Center of Excellence for related technical competencies The NCB execution program or mechanism is done through a self-management system (swakelola) by the signing of a Memorandum of Understanding between SKK Migas and 6 universities and Pusdiklat Migas Cepu, followed by the drafting of a cooperation contract involving the universities, LEMIGAS, associated professions (exp: HAGI, IAGI, IATMI) and PSC Contractor practitioners (Indonesian and Foreign Workers), with the following aims:
To empower and engage capable national capacities with the potential to be

developed.
To reduce the cost of sending fresh graduates abroad to undergo a graduate program.
An NCB program involving 240 participants is planned for next year and 2014, to enter in main educational programs, such as G&G, drilling engineer, drilling supervisor, reservoir engineer, production / operation engineer, process engineer, maintenance/reliability engineer, and rotating engineer
97
E. CONTINUOUS DEVELOPMENT
E.
In 2012, the concept of environment based development was upgraded to continuous development in order to support the 2015 Millennium Development Goals (MDG), one of which is to ensure environmental sustainability through the fulfillment of the current needs without compromising the needs of future generations.
CONTINUOUS DEVELOPMENT
In 2012, the concept of environment based development was upgraded to continuous development in order to support the 2015 Millennium Development Goals (MDG), one of which is to ensure environmental sustainability through the fulfillment of the current needs without compromising the needs of future generations. The Companys Environmental Rating Program (Proper), developed by the Ministry of Environmental Affairs, is an excellent instrument because it not only takes into account regulations but also incorporate resource conservation, as well as social responsibility aspects. In 2012, in general PSC Contractors received better Proper ratings, and even though there are still 5 PSC Contractors which received a Red Proper ranking, this is more because of a momentary lapse in the quality standards. 55 PSC Contractors fulfilled the quality standards and as such received a Blue Proper ranking, while 23 PSC Contractors received a Green Proper ranking for having an environmental management and resource conservation system. Only 1 PSC Contractor received a Gold Proper ranking for implementing a continuous social responsibility program.
PROPER 2002 - 2012*
2002 BLACK PINK RED LIGHT BLUE BLUE GREEN GOLD 0 0 1 0 5 0 0
2003 0 0 4 0 11 0 0
2004 0 0 14 0 36 0 0
2008 1 3 3 12 27 7 0
2009 1 5 5 29 17 10 0
2010 0 0 11 0 48 11 0
2011 0 0 5 0 52 19 1
2012 0 0 5 0 54 23 1
* In 2005, 2006 and 2007 the Environmental Ministry did not conduct PROPER
The environmental document is a basic guideline to manage activities in regards to environmental sustainability and monitored by the Government through the granting of environmental licenses. Throughout 2012, approvals for environmental permits has decreased due to the constraints caused by the transition from the central Government to the local Government, and also due to the unpreparedness of the local Government.
Environment Permit Documents
140 120 100 80
114 93
86 66 70
UKL-UPL AMDAL/RKL-RPL
60
58 45 44 39
64
59
40 20
25 6 2003 5 2004 3 2005 4 2006 4 2007 10 2008 6 2009 8 2010 2011 7 2012
2
0
2002
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SKK MIGAS
ANNUAL REPORT 2012
Utilization of Flare Gas
In supporting the Governments directive to reduce flare gas in Indonesia, in 2012 SKK Migas with PSC Contractors utilized flare gas in the Tuban District, Sorong District, Tarakan City, and Bunyu Island. JOB Pertamina - PetroChina East Javas flare gas was utilized by PT Gasuma Corporindo to fulfill industrial gas in the Tuban District and domestic LPG; JOB Pertamina PetroChina Salawati flare gas was utilized by PT Malamoi Olom Wobok to lift oil and supply gas for electricity in the Sorong District; furthermore PT Pertamina EP Bunyu Fields flare gas was utilized by PLN Tarakan and PLN Bunyu to fulfill the electricity needs in Tarakan and Bunyu Island.
Social Responsibility
SKK Migass Bright and Green Program is our effort to boost economic activities, mainly in districts or provinces where upstream oil and gas activities occur and areas that have processing facilities and upstream production. This program aims to give local residents access to electricity (bright) so that they can immediately benefit from the upstream oil and gas industry. An example of the bright and green program in 2012 is the utilization of Kondur Petroleum S.A. gas by PT PLN (Persero) to fulfill the electricity demand in the Melibur District. In order to achieve the safety work plans, than all safety and health matters must be handled with the upmost priority. Occupational safety performance is measured by an index level of accidents in accordance with the American National Standard Institute (ANSI), where the lower the index level, the better the PSC Contractors performance. In 2012, we were able to achieve the lowest index level in the past 6 years.
Upstream Oil and Gas Work Incident Data
2.5
2.29 1.84 2 1.67 1.25
1.5
1.15
1 Incident rate
1.11
1.06
0.97 0.68
0.5
0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
To ensure marine safety, all offshore activities are socialized to the maritime community through Maklumat Pelayaran (Mapel) and Berita Pelaut Indonesia (BPI) so that activities undertaken will not be affected by marine traffic. In 2012, a total of 62 offshore activities were announced through Mapel and BPI.
99
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SKK MIGAS
ANNUAL REPORT 2012
VI
INTERNAL SKK MIGAS
101
VI. INTERNAL SKK MIGAS
A. SKK MIGAS STRATEGIC PLAN (RENSTRA) FOR 2011-2015
A.
BPMIGAS (now SKK MIGAS) strategic plan was approved on December 16th, 2011; based on the National Development Strategy, prevailing regulations and the hopes on stakeholders and also aligned with SKK Migas vision and mission.
SKK MIGAS STRATEGIC PLAN (RENSTRA) FOR 2011-2015

BPMIGAS (now SKK MIGAS) strategic plan was approved on December 16th, 2011; based on the National Development Strategy, prevailing regulations, stakeholders aspirations along with SKK Migas vission and mission. From these process 8 strategic targets, 15 initiatives and 81 working plans were formulated.
8
TARGETS 1. INCREASE OIL AND GAS RESOURCES AND RESERVES. 2. OPTIMIZE OIL AND GAS PRODUCTION. 3. OPTIMIZE THE UPSTREAM OIL AND GAS INDUSTRYS OPERATIONAL COSTS. 4. INCREASE THE EMPOWERMENT OF NATIONAL CAPABILITIES AND CAPACITIES. 5. REGULATORY MANAGEMENT 6. PEOPLE 7. PROCESS 8. TOOLS
15
INITIATIVES
2011 - 2015
81
WORK PROGRAMS
2011-2012
2013
2014-2015
15
WORK PROGRAMS
25
WORK PROGRAMS
41
WORK PROGRAMS
The 8 strategic targets were divided into 2 categories, which are: 4 strategic actions: To increase oil and gas resources and reserves. To optimize oil and gas production. To optimize the upstream oil and gas industrys operational costs. To increase the empowerment of national capabilities and capacities. 4 strategic enablers:
5. To support the effectiveness of regulatory framework among perpetrators in the
1. 2. 3. 4.
upstream oil and gas industry.

6. To increase SKK Migas internal human resources capability and capacity. 7. To optimize the sustainability of SKK Migas work process and management system. 8. To implement integrated and transparent information systems for SKK Migas internal
and PSC Contractors These 8 strategic targets were then broken down into 15 initiatives and 81 working plans distributed into 3 periods: 15 working plans in 2011-2012; 25 working plans targeted for 2013; and 41 working plans targeted to be completed in 2014-2015. Monitoring and review of targets set in SKK Migas Strategic Plan and Annual Work Meeting is done periodically. In the 2011 Annual Work Meeting, the Chairman of BPMIGAS (now SKK Migas) appointed the Corporate Secretary to monitor the implementation of work programs by all functions in BPMIGAS (now SKK Migas). The monitoring process was done by quarterly report and was part of the Corporate Secretarys Key Performance Indicator. In mid 2012, the Corporate Secretary invited all the functions in SKK Migas to give progress reports and convey revisions to the work program, if any, for example if the budget for a work program was rejected by relevant stakeholders. The monitoring results will then be reported periodically every quarter to the SKK Migas management.
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SKK MIGAS
ANNUAL REPORT 2012
B.
EXECUTIVE ADVISOR
CONFIGURING BPMIGAS (NOW SKK MIGAS) ORGANIZATION STRUCTURE

Based on MEMR Letter Number 2302/08/MEM.S/2012, dated March 29th, 2012, the function, role and organizational structure of BPMIGAS (now SKK Migas) is as follows:
BPMIGAS (now SKK Migas) ORGANIZATION STRUCTURE
BPMIGAS CHAIRMAN BPMIGAS VICE CHAIRMAN

INTERNAL AUDITOR UNIT
DEPUTY FOR PLANNING
DEPUTY FOR OPERATIONS MANAGEMENT
DEPUTY FOR FINANCIAL MANAGEMENT
DEPUTY FOR EVALUATION AND LEGAL ADVISORY
DEPUTY FOR GENERAL AFFAIRS
MONETIZATION OF OIL AND GAS
EXPLORATION DIVISION
PROJECT MANAGEMENT DIVISION
RISK MANAGEMENT AND TAXATION DIVISION
EVALUATION, REPORTING, AND INFORMATION TECHNOLOGY DIVISION
HUMAN RESOURCES AND GENERAL AFFAIRS DIVISION
CORPORATE SECRETARY
PRODUCTION DIVISION
PRODUCTION OPERATIONS DIVISION
ACCONTING DIVISION
LEGAL ADVISORY DIVISION
PROCUREMENT AND ASSET MANAGEMENT DIVISION
EVALUATION AND DEVELOPMENT DIVISION
OPERATION FACILITIES MAINTENANCE DIVISION
OPERATIONAL COST AUDIT DIVISION
MANAGEMENT REPRESENTATIVES
PUBLIC RELATIONS, SECURITY AND FORMALITIES DIVISION
WORK PROGRAM AND BUDGET MANAGEMENT DIVISION
OPERATION SUPPORT DIVISION
GOVERNMENT ENTITLEMENT AUDIT DIVISION
REPRESENTATIVE DIVISION
SKK Migas organizational structure is derived from the dynamics of upstream oil and gas activities in Indonesia and Government mandates.
BPMIGAS (now SKK Migas) organizational structure is derived from the dynamics of upstream oil and gas activities in Indonesia and Government mandates so as to ensure that BPMIGAS (now SKK Migas) creates a breakthrough in supervising the upstream oil and gas activities in order to optimize production. Structuring of the organization leads to the following:
To expedite monetization / commercialization of discovered reserves and new fields. To improve intensification of existing potential fields by maintaining and increasing
production of all PSC Contractors.
To carry out Government directives regarding EOR implementation, CBM management,

increasing the use of local content, and decreasing unplanned shutdown.
To strengthen BPMIGAS (now SKK Migas) coordination and policy in the future.
103
C. ISO 9001:2008 CERTIFICATION
C.
ISO 9001:2008 CERTIFICATION
BPMIGAS (now SKK Migas) management decided that all the functions in SKK Migas should undergo an ISO 9001:2008 certification process. The audit started on June 15th, 2012 and ended on September 7th, 2012. The scope of the ISO 9001:2008 is the supervision and control of upstream oil and gas activities by PSC Contractors. There are 5 stages in order to receive an ISO 9001:2008 Certification. Starting from Audit Preparations, Internal Audit, Corrections, Audit Certification, and Follow-Up.
PREPERATIONS
INTERNAL AUDITS
CORRECTIONS
AUDIT CERTIFICATION
FOLLOW UP
ISO CERTIFICATION AWARD
On September 11th, 2012, TUV North officially published an ISO 9001:2008 Certificate for BPMIGAS (now SKK Migas).
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SKK MIGAS
ANNUAL REPORT 2012
1. Audit Preparations
ISO 9001:2008 audit certification for BPMIGAS (now SKK Migas) employees on behalf of all functions were conducted on 15-16 May 2012.
2. Internal Audit
a. 25 Internal Auditors conducted internal audits on 5-18 June 2012. b. The results of the internal audit were 22 non-conformity foundings and 10 suggestions.
3. Corrections
a. The 22 non-conformity foundings were followed up by the Organization and Management System Department and related functions by revising several business processes and existing Standard Operating Manual. b. The 10 suggestions were followed up by planning the implementation in each function.
4. ISO 9001:2008 Audit Certification
ISO 9001:2008 audit certification was conducted by TUV Nord, divided into 2 stages: a. Stage I (29-30 August 2012) - Quality Management System audit and sampling from 2 Divisions (Exploration and Production). b. Stage II (3-7 September 2012) - Quality Management System implementation audit throughout all the BPMIGAS (now SKK Migas) Divisions. c. No findings of non-conformity.
5. Follow-Up
Due to the certification audit, all follow-ups to findings were conducted in the preparation stage and no residual non-conformities were found.
105
D. INTERNAL HUMAN RESOURCES MANAGEMENT AND DEVELOPMENT
D.
1. Employee Demographic
Quantity of Employees
200 150
INTERNAL HUMAN RESOURCES MANAGEMENT AND DEVELOPMENT

a. The quantity of employees per December 2012 is 919 employees. Consisting of
818 permanent employees and 101 contract employees.

b. A rapid organization growth is shown by the 69% of new employees actively working
in the past 5 years (since 2008).
182
186 168 148
Employees
Number of People
100 51 50 18 0
MANAGEMENT EXECUTIVE UNIT PLANNING EXECUTIVE UNIT OPERATIONS MANAGEMENT EXECUTIVE UNIT FINANCIAL MANAGEMENT EXECUTIVE UNIT
83
Temporary Employees
28 5 7 2
EVALUATION AND LEGAL ADVISORY EXECUTIVE UNIT
41
GENERAL AFFAIRS EXECUTIVE UNIT
Age of Employees
400
<26 26-30 31-35 36-40 41-45 46-50 51-55 >55

Number of People
300
200
100
0
MANAGEMENT EXECUTIVE ADVISOR DIVISION HEAD / EQUIVALENT SENIOR MANAGER / EQUIVALENT MANAGER / EQUIVALENT STAFF / AUDITOR / LEGAL COUNSEL SECRETARY SECRETARIAT
Educational Background
39% 28%
EARTH SCIENCE
ENGINEERING
17% 6% 3% 2% 1%
SCIENCES
6% 17% 39%
ECONOMY
LAW
PSYCHOLOGY
SOCIAL
28%
4%
SECRETARIAL
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ANNUAL REPORT 2012
2. Recruitment
A total of 82 new employees were recruited in 2012 (22 were recruited to close the gap of employees in 2011, employees entering their retirement and resignation, as well as 60 employees based on the approved 2012 budget by the Ministry of Finance). The diversity in new employees reached the target set for placement, education and race, however it has not reached the target regarding job experience and gender.
The employee formation approval for 2012 is 829 employees
The quantity of employees in the beginning of 2012 is 761 employees, however based on the employee formation target in 2011 of 768 employees, there is a gap of 8 employees. The employee recruitment target in 2012 is 60 employees. Which makes the total recruitment target 68 employees.
The additional target of 18 employees is caused by resignation (4), retirement (11), non active MPP (2) and death (1). Which makes the total recruitment target 86 employees
Before 2012 the recruitment process was conducted quietly by referral to cover the 2011 gap and to replace ex-employees - resulting in 22 employees. Total vacant positions announced through an open recruitment process is 63 positions - resulting in 60 employees (53 active in 2012 and 7 active in 2013).
The gap of 4 workers: 1 worker resigned after signing the employment contract because of inability to participate in the on-boarding program 2 Division did not utilize its slot for 2 positions (Representative Office, Procurement) 1 position is for the external Manager (Exploration)
The growth of SKK Migas organization is moving at a rapid pace and is focused on the development of the Planning and Operations Management Unit. The growth of the organization in 2012 in each Executive Unit is as follows:
Percentage of Employees per Executive Unit
33%
PLANNING EXECUTIVE UNIT
6% 13% 10% 9% 29% 33%
29%
OPERATIONS MANAGEMENT EXECUTIVE UNIT
9%
FINANCIAL MANAGEMENT EXECUTIVE UNIT
10%
EVALUATION AND LEGAL ADVISORY EXECUTIVE UNIT
13%
GENERAL AFFAIRS EXECUTIVE UNIT
6%
CHAIRMAN AND VICE CHAIRMAN EXECUTIVE UNIT
107
D. INTERNAL HUMAN RESOURCES MANAGEMENT AND DEVELOPMENT
The growth of SKK Migas organization is moving at a rapid pace and focusing in the development of the Planning and Operations Management Function.
Learning and Development
1. Throughout 2012 there have been 41 in-house courses and 4 on-boarding
programs (2 generations).
Management
Domestic Abroad 37% 63%
Head
Abroad 45% Domestic 55%
Senior Manager
Manager
Abroad 43%
Domestic Abroad 50% 50%
Domestic 59%
Staff
Secretariat
Executive Advisor
Domestic 50%
Abroad 50%
On-Boarding Program Process XVIII Generation
TEAM BUILDING
Department of Psychology Army
INTERNAL CLASSROOM
WORKING IN EACH UNIT 60 Days
EMPLOYEE APPOINTMENT LETTER OF DECREE
ON THE JOB TRAINING 60 Days
10 Days
12 Days 5 MONTHS
2. 1,178 public learning programs were conducted, with 823 domestic programs and
355 programs abroad.

3. From those 1,178 programs, 1,069 programs were seminars, workshops,
and conferences, while the rest 109 programs were certified programs. On November 13th, 2012 the realization percentage of BPMIGAS employees Individual Learning Plan (RPI) is 68,39%. 4. The signing of a Memorandum of Understanding and Self-Management Agreement regarding Learning Programs with 2 institutions, BPKP and the Armys Department of Phycology.
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3 REASONS
WHY ORGANIZATIONAL BEHAVIOR ASSESSMENT IS FOR YOU?
ONE OF THE COMPONENTS IN PERFORMANCE APPRAISAL
HELP EMPLOYEES IN RECOGNIZING THEIR STRENGTHS AND AREAS OF DEVELOPMENT
HELP THE MANAGEMENT IN DEFINING COMPETENCIES AND LEARNING
Percentage of Organizational Behavior Assessment per December 28 th, 2012.
100%
16% 84%
11% 89%
13% 88%
80%
60%
<70% Total Respondent >70% Total Respondent
40%
20%
0 STRUCTURAL NON STRUCTURAL SECRETARY
5. 19 functional competencies for functions undergoing changes caused by
organizational shifts were completed and sent to each function to certify on October 23rd, 2012. 6. Individual employees end of year performance appraisal started with an Organizational Behavior Assessment with an average of 76% filled. Individual employees behavior appraisal was conducted with 87% filled. The cut off date for appraisal was January 2nd, 2013. 7. The budget realization for learning and development of SKK Migas employees reached 122%.
109
E. MANAGEMENT AND DEVELOPMENT OF PSC CONTRACTORS HUMAN RESOURCES
E.
Indonesian vs. Foreign Manpower in Production PSC Contractors
30,000 25,000 20,000
MANAGEMENT AND DEVELOPMENT OF PSC CONTRACTORS HUMAN RESOURCES

The total number of production PSC Contractors manpower up to the end of 2012 is 25,298 people or a 2% rise from 2011. From that total, 97% constitutes as the Indonesian manpower (TKI) while only 3% are foreign manpower (TKA).
27,544 23,938 20,491 21,277 21,492 21,520 21,727 24,478
Foreign Manpower
Number of People
Indonesian Manpower
15,000
10,000
5,000
792
0
783 2007
714 2008
649 2009
776 2010
792 2011
820 2012
1,043 2013
2006
The total number of exploration PSC Contractors manpower is 1,274 people or a 1% decline from 2011. This decline is caused by exploration failures in several areas (mainly in eastern area of Indonesia). From that total, 95% constitutes as the Indonesian manpower (TKI).
Indonesian vs. Foreign Manpower in Exploration PSC Contractors
2,500
2,000
2,176
2,233 1,786
1,637
1,500
1,601 1,305
1,344
Number of People
Indonesian Manpower
1,000
1,204
500
277
0
249
246
252 152 2009 2010
183 70 2011 2012
117 2013
Foreign Manpower
2006
2007
2008
The number of Indonesian and foreign manpower in the upstream oil and gas industry is dependent on the amount and type of activities conducted in that year. In 2012, the cumulative number of manpower in exploration and production PSC Contractors increased 2% compared to 2011. However, since 2008, the use of foreign manpower is maintained to be lower than 4% of the total manpower.
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It is predicted that due to the needs of PSC Contractors there will be a significant raise in the upstream oil and gas industry manpower in 2013.
The opportunity for Indonesia manpower based on the approved manpower plan approval (RPTK) is 6,025 positions in many fields. It is predicted that due to the needs of PSC Contractors in developing certain major projects, such as Mobil Cepu Ltd., BP Indonesia, and Inpex Masela Ltd., there will be a significant raise in the upstream oil and gas industry manpower in 2013. Those projects are a continuation of 2012. The use of foreign manpower is limited to disciplines where Indonesian manpower is inadequate and as investor representatives (leadership). Foreign manpower is required to have a minimum of 10 years experience. For the development of Indonesian manpower, SKK Migas encourages PSC Contractors to have an internalization program (swapping & TDE).
111
F. SKK MIGAS BUDGET REALIZATION AND EXPENDITURE
F.
The Minister of Finance approved SKK Migas budget for 2012 amounting to Rp1,46 trillion and US$14.56 million or a total of Rp1,59 trillion assuming the currency exchange is Rp9.000 per US$
SKK MIGAS BUDGET REALIZATION & EXPENDITURE

The Minister of Finance approved SKK Migas budget for 2012 amounting to Rp1,46 trillion and US$14.56 million or a total of Rp1,59 trillion assuming the currency exchange is Rp9.000 per US$. That amount has risen compared to BPMIGAS 2011 budget of Rp289 billion, this is because of added work programs and manpower, which in turn caused an increase in wages, benefits, along with the planning and development of human resources. However, such amount is still much lower than the allowed percentage (1%) of upstream oil and gas 2011 revenue. By December 2012, the budget realization is 52% for human resources cost and professionalism enhancements, followed by lease of office space 10% and other operational costs 38%.
Budget Realization And Expenditure (US$)
18% 31%
18%
EMPLOYEE & PROFESSIONAL DEVELOPMENT COST
4%
INFORMATION SYSTEM MANAGEMENT DEVELOPMENT IN 2012
31%
OPERATIONAL MANAGEMENT
46%
OFFICIAL ASSIGNMENT ABROAD
4% 46%
1%
BUSINESS EVALUATION AND DEVELOPMENT
0%
OTHER ACTIVITIES
Budget Realization And Expenditure (Rp)
5%
56%
EMPLOYEE & PROFESSIONAL DEVELOPMENT COST
1%
BUSINESS EVALUATION AND DEVELOPMENT
19% 56%
11%
OFFICE SETUP AND LEASE
2%
INFORMATION SYSTEM MANAGEMENT DEVELOPMENT IN 2012
6% 11%
6%
ASSIGNMENT BENEFITS
0%
OFFICIAL ASSIGNMENT ABROAD
19%
OPERATIONAL MANAGEMENT
5%
OTHER ACTIVITIES
112
SKK MIGAS
ANNUAL REPORT 2012
G.
In December 22nd, 2011, the Chairman of BPMIGAS issued a letter of decree obligating each and every BPMIGAS management and employee, no exception, to submit a State Official Property Report to the Corruption Eradication Commission (KPK).
STATE OFFICIAL EMPLOYEE REPORT BY SKK MIGAS
Following the Memorandum of Understanding between BPMIGAS and KPK in 2011 and as concrete support for transparency and prevention of corruption, the Chairman of BPMIGAS issued letter of decree Number KEP-0175/BPO0000/2011/S0 dated December 22nd, 2011, obligating each and every BPMIGAS management and employee, no exception, to submit a State Official Property Report (Laporan Harta Kekayaan Penyelenggara Negara - LHKPN) to the Corruption Eradication Commission (KPK). Collection of LHKPN was targeted on May 22nd, 2012. Socialization regarding technical guidelines in filling the LHKPN form was conducted 5 times by SKK Migas in conjunction with KPK. The initial collection time of all the employees LHKPN was not met due to several employees being out of town / abroad and approximately 70 new employees partaking in orientation, resulting in the cut off date being moved to November 13th, 2012. On November 13th, 2012, 750 employees (97.5%) from of a total of 769 employees handed in their LHKPN, which as a government agency supporting transparency is an achievement in itself. KPK Chairman, Abraham Samad and BPMIGAS Chairman officiate the Guidelines Governing Gratification (Pedoman Pengendali Gratifikasi - PPG) and the Whistle Blowing System (WBS) in BPMIGAS office on April 10 th, 2012. PPG is a guideline on gratification for BPMIGAS management and employees. This guideline is used as a tool to ensure that BPMIGAS management and employees conduct themselves in an appropriate manner. While the WBS is used as a tool for acts or potential corruption, bribery, and other fraudulent practices.
113
H. INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT)
H.
Integrated Operating System (IOS)
INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT)

Information management is an important factor in the upstream oil and gas industry. As an organization that strives to be a world-class organization, it has become imperative for SKK Migas to optimize its information technology system in fulfilling its role to manage upstream oil and gas activities. One of the breakthroughs is Integrated Operating System (IOS), which is used to monitor each PSC Contractors oil and gas production in near real time. In the initial stage, IOS was applied to 9 PSC Contractors representing more than 50% of national oil and gas production, which consists of Chevron Indonesia Company, Chevron Makassar Ltd, PT Chevron Pacific Indonesia, Chevron Siak Inc., Total E&P Indonesie, ConocoPhillips (Grissik) Ltd, ConocoPhillips (South Jambi) Ltd, ConocoPhillips Indonesia Inc. Ltd, and Virginia Indonesia Company (Vico) LLC. Currently, IOS is also in the progress of deployment to monitor Drilling, Financial, and Asset Life-Cycle Management. Example: Implementation of IOS in ConocoPhillips
By implementing IOS Production Monitoring, the flow of data for reporting is exchanged through system-to-system data communication mechanism. This increases the accuracy and transparency of data. In 2013, IOS will be implemented in another 14 PSC Contractors with considerable production. Go Green In supporting Go Green, SKK Migas has improvised by optimizing the use of e-mail, enterprise content management (ECM) and printer management usage. These initiatives are contributed to support the Paperless and Go Green Policy. ECM is an integrated document processing system. The ECM structure was developed based on SKK Migas organization structure. With ECM, document collaboration in the user level and the application level can be easily managed because the user level uses information collaboration folder, application level uses web service (via enterprise service bus).
114
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ANNUAL REPORT 2012
Printer Management Usage
Printer Management Usage, so called Print-Per-Click, is a system designed to control the printer management, the use of paper, paper, and toner, with main aims to improve the efficiency of energy, paper and toner/ink consumptions, in addition to avoid unauthorized printing (secure printing).
160,000 140,000 120,000
106,804
153,070 131,255
143,981
100,000 80,000
101,837 95,773 80,803
101,268
119,687
84,037
71,577
60,000 40,000 20,000 16,132
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
Note. The use of paper for printing has declined drastically
Indonesia Open Source Award (IOSA)
In 2012, BPMIGAS (now SKK Migas) won first place in the Indonesia Open Source Award (IOSA). The Minister of Communication and Information Technology, Mr. Tifatul Sembiring presented this award. IOSA was held to increase utilization and implementation of free and open source software (FOSS) in the Government and educational institutions. This award was given through a series of assessments and observations of a variety of Government agencies and secondary education institutions regarding the level of utilization and implementation of open source software in its organizations activities. BPMIGAS (now SKK Migas) won first place in the central government category. According to the Ministry of Communications and Information Technology, the use of FOSS by BPMIGAS not only refers to cost considerations, but also on the basis of security and reliability. Furthermore, BPMIGAS was also deemed able to require third parties (contractors) to use open source software. The IOSA started in 2010 and has become an annual event. In 2012, 17 central government agencies and 64 regional government agencies participated in IOSA 2012. With the increased use of open source, Indonesia could become self-sufficient in meeting its information technology needs.
115
116
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2012 ANNUAL REPORT
APPENDIX
2012 OIL, GAS AND CBM CONTRACT AREA MAP
117
APPENDIX
SPECIAL TASK FORCE FOR UPSTREAM OIL AND GAS BUSINESS ACTIVITIES REPUBLIC OF INDONESIA
EXPLORATION DIVISION, PLANNING MANAGEMENT GROUP
118
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2012 ANNUAL REPORT

Status : Januari 1st, 2013
119
APPENDIX
2012 OIL, GAS AND CBM CONTRACT AREA MAP LEGEND

AREA I
I.01 I.02 I.03

Air Komering, CAHAYA BR

PSC, 12-12-2004, Ons.Eks(B-3)
Anambas, AWE
PSC, 12-12-2004, Off.Eks(C1-2)
Andaman III, TALISMAN

PSC, 30-11-2009, Off.Eks(A1)
I.04 I.05 I.06 I.07 I.08 I.09 I.10 I.11 I.12 I.13 I.14 I.15 I.16 I.17 I.18 I.19 I.20 I.21 I.22 Area A N.Sumatera, Medco
PSC-EXT, 01-09-1991, Ons.Ept-EXT (A2)
Bangko, PETROCHINA
PSC, 17-02-1995, Ons.Ept (B3)
Baronang, LUNDIN
PSC, 30-12-2003, Ons.Eks(B3)
Batanghari, CNOOC
PSC, 16-01-2007, Ons.Eks(B3)
Batu Gajah, RANHILL

PSC, 16-01,2007, Ons.Eks(B3)
Territorial Sea Limit, need agreement Continental Shelf Maximum Claim (where possible)
Belida, SELE RAYA

PSC, 12-12,2004, Ons.Eks(B3)
Bentu Segat, KALILA

PSC, 20-05,1991, Ons.Ept(B2)
CA LEGEND
I.01

Bohorok, BUKIT ENERGY

PSC, 25-05,2012, Ons.Eks(A2)
Air Komering, CAHAYA BR

PSC, 12-12-2004, Ons,Eks
Bukit Batu, GEO LINK

PSC, 25-05,2012, Ons.Eks(B2)
How to reade the legend I.01 Air Komering Cahaya BR PSC 12-12-2004 Ons. Exp. B-3
Bungamas, BUNGAMAS E.
PSC, 22-12,2005, Ons.Eks(B3)
: Contract Area ID : Contract Area : Operator : Type of Contract : Contract Effective Date : Location Ons/Off : Status : Contract Area Location (in column B, line 3)
Cakalang, LUNDIN
PSC, 13-11,2008, Off.Eks(C1)
CPP, BOB BUMI SIAK PUSAKO

PSC, 09-08,1975, Ons.Ept (B2)
Corridor, COPI
PSC, 20-12,1983, Ons.Ept-EXT(B3)
Duyung, W.NATUNA EXPL.

PSC, 16-01,2007, Off.Eks(C2)
East Jabung, PAN ORIENT

PSC, 11-11,2011, Ons.Eks(B3)
Information CA Legend Colors Exploration CA : 161
East Pamai, NORTHERN

PSC, 05-05,2009, Ons.Eks(B2)
GMB Exploration CA
: 54
East Seruway, KRISENERGY

PSC, 13-11,2008, Ons.Eks(A2)
Production CA
: 75
East Sokang, SERICA

PSC, 10-10,2012, Ons.Eks(A2)
Gebang, PHE COSTA

JOB, 29-11,1985, OnS/Off.Ept(A2)
Termination Process CA : 18
I.23 I.24 I.25 I.26 I.27 I.28 I.29 I.30 I.31 I.32 I.33 I.34 I.35 I.36 I.37 I.38 I.39 I.40 I.41 I.42 I.43 I.44
Gurita, LUNDIN GURITA BV

PSC, 12-12,2004, Ons.Eks(B-3)
Jabung, PETROCHINA
PSC, 27-02,1993, Ons.EPT(B3)
Jambi Merang, JOB HESS JOB, 10-02,1989, Ons.Ept(B3) Kakap, STAR ENERGY
PSC, 22-03,1975, Off.Ept-EXT(C1)
Kalyani, EURORICH
PSC, 19-12,2011, Ons.Eks(B3)
Karang Agung, ODIRA

PSC, 16-01,2007, Ons.Ept(B3)
Kerapu, PEARL OIL

PSC, 13-11,2008, OFF.Eks(c1)
Kisaran, PACIFIC O7G

PSC, 17-05,2001, Ons.Eks(B2)
Korinci Baru, KALILA

PSC, 15-05,1997, Ons.EPT(B2)
Krueng Mane, ENI

PSC, 27-09,1999, Off.Ept(A1)
Lampung III, HARPINDO

PSC, 05-05,2009, Ons.Eks(C3-4)
Langgak (MFK), SPR-KINGSWOOD

PSC, 25-11,1963, Ons.Ept(B2)
Lemang, HEXINDO
PSC, 16-01,2007, Ons.Eks(B3)
Lematang, MEDCO
PSC, 06-04,1987, Ons.Ept(B3)
Lhokseumawe, ZARATEX
PSC, 22-12,2006, Ons/Off,Eks(A1)
Lirik II, KARYA INTI

PSC, 16-01,2007, Off, Eks(C2)
Mahato, EMASPTH-BKTENERGY
PSC, 25-05,2012, Ons.Eks(B2)
Malacca Strait, KONDUR

PSC, 05-08,2000, Ons/Off, Ept-EXT(B2)
Marquisa, SCHINTAR
PSC, 01-04,2011, Ons.Eks(AB-2)
Mentawai, TOTAL
PSC, 09-10,2012, Ons.Eks(AB-2)
Merangin I, MEDCO
PSC, 06-04,1987, Ons.Eks(B3)
Merangin II, SELE RAYA

PSC, 04-10,2003, Ons.EPT(B3)
120
SKK MIGAS
2012 ANNUAL REPORT
I.45 I.46 I.47 I.48 I.49 I.50 I.51 I.52 I.53 I.54 I.55 I.56 I.57

Natuna A, PREMIER PSC-EXT, 16-10,2009, Off, Ept-EXT(C1-2) North Baturaja, TERRA GLOBAL
PSC, 19-12,2011, Ons.Eks(B3)
NE.Natuna, TITAN RES.

PSC, 15-05,1997, Off.Eks(C1)
North Sokang, NS ENERGY LTD

PSC, 00-12,2010, Off.Eks(C1)
N.Sumatra B block, EXXON

PSC-EXT, 01-09,1997, Ons.Eks(B-3)
NW Natuna, GENTING OIL

PSC, 12-12,2004, Off.Eks(C1)
North Sumatera Ofs, EXXON

PSC, 17-09,2005, Ons/Off.Ekp-EXT(A1)
Ogan Komering, JOB TALISMAN

PSC, 29-02,1988, Ons.EPT(B3)
Palmerah, TATELY N.V

PSC, 30-12,2003, Ons.Eks(B3)
Pandan, TROPIK ENERGY

PSC, 12-12,2004, Ons.Eks(B3)
Pari, INDOREACH
PSC, 16-01,2007, Off.Eks(C2)
Pase, TRIANGLE PASE INC.

PSC, 16-10,1968, Ons.Ept(A2)
Pendopo, JOB GOLDENSPIKE

JOB, 06-07,1989, Ons.Ept(B3)
I.58
Puri, PURI PETROLEUM

PSC, 18-05,2010, Ons.Eks(B3)
I.59 I.60 I.61 I.62 I.63 I.64 I.65 I.66
Ranau, PRABU ENERGY

PSC, 12-11,2011, Ons.Eks(B3)
Rimau, MEDCO
PSC, 23-04,1973, Ons.Ept(B3)
Rokan, CHEVRON
PSC-ext, 28-11,1993, Ons.Ept-EXT(B2)
Sakakemang, CAKRA NUSA

PSC, 18-05,2010, Off.Eks(B3)
Sekayu, STAR ENERGY

PSC, 16-01,2007, Ons.Eks(B3)
Selat Panjang, PETROSELAT

PSC, 08-09,1991, Ons.EPT(B2)
Sembilang, MANDIRI PU
PSC, 01-04,2011, Ons.Ept(B2)
Seruway, TRANSWORLD
PSC, 12-12,2004, Ons.Eks(A2)
I.67 I.68 I.69 I.70 I.71 I.72 I.73 I.74 I.75 I.76 I.77 I.78 I.79 I.80 I.81 I.82 I.83 I.84 I.85 I.86 I.87 I.88
Siak, CHEVRON
PSC, 25-09,1963, Ons.Ept(B2)
Sokang, BLACK PLAT.INVST

PSC, 00-12,2010, Off.Eks(C2)
S&C. Sumatera, MEDCO

PSC, 28-11,1963, Ons.Ept(B3)
South Baturaja, ANUGERAH MS

PSC, 19-12,2011, Ons.Eks(B3)
South Betung, TECHWIN

PSC, 01-04,2011, Ons.Eks(B3)
South Blok A, RENCO ENERGY

PSC, 05-05,2011, Ons.Eks(A2)
I.89 I.90 I.91 I.92 I.93 I.94

GMB Air Benakat I, PHE METANA

PSC, 30-04,2011, Ons.Eks(B3)
GMB Air Benakat II, PHE METANA

PSC, 30-04,2011, Ons.Eks(B3)
GMB Air Benakat III, PHE METANA

PSC, 30-04,2011, Ons.Eks(B3)
GMB Air Komering, BATURAJA-ANUGRAH

PSC, 30-04,2011, Ons.Eks(B3))
GMB Batang Asin, BUMI&GLORY

PSC, 30-11,2009, Ons.Eks(B3)
GMB Belida, SELE-ANDALAS PSC, 01-04,2011, Ons.Eks(B3) GMB Indragiri Hulu, SAMANTAKA
PSC, 26-06,2008, Ons.Eks(B3)
South CPP, RANHILL PAMAI

PSC, 13-11,2008, Off.Eks(B2)
SE. Tungkal, GUJARAT

PSC, 13-11,2008, Off.Eks(B3)
South Jambi B, COPI

PSC, 26-01,1990, Ons.Ept(B3)
South Natuna B, COPI PSC-EXT, 16-10,2016, Off.Ept-EXT(C2) S Lirik, TEXCAL-INDRILL

PSC, 25-05,2012, Ons.Eks(B3)
S Sokang, LUNDIN-SALAMANDER
PSC, 06-12,2010, Off.Eks(C2)
SW. Bukit Barisan, RADIANT

PSC, 13-11,2008, Ons.Eks(A2)
Sumbagsel, COOPER ENERGY

PSC, 01-04,2011, Ons.Eks(B3)
Tonga, MOSESA PETROLEUM

PSC, 16-01,2007, Ons.Ept(A2)
Tuna, PREMIER
PSC, 21-03,2007, Off.Eks(C1)
Tungkal, MONTDOR OIL

PSC, 26-08,1992, Ons.Ept(B3)
W.Air Komering, TIARA BUMI

PSC, 21-03,2007, Ons.Eks(B3)
W.Belida, ORCHARD ENERGY

PSC, 05-05,2009, Ons.Eks(B3)
W. Glagah K, PETRONAS
PSC, 30-11,2009, Ons.Eks(A2)
W.Kampar, SPE
PSC, 22-12,2005, Ons.Eks(B2)
W.Tungkal, THREE GOLDEN

PSC, 13-11,2008, Off.Eks(B3)
I.95 I.96 I.97 I.98 I.99 I.100 I.101 I.102 I.103 I.104 I.105 I.106 I.107 I.108 I.109 I.110 I.111
GMB Lematang, MEDCO-SAKA

PSC, 01-04,2011, Ons.Eks(B2)
GMB Muara Enim, TRISULA

PSC, 30-11,2009, Ons.Eks(B3)
GMB Muara Enim I, PHE INDO GAS

PSC, 24-11,2010, Ons.Eks(B3)
GMB Muara Enim II, PHE-MTN-INDON

PSC, 01-04,2011, Ons.Eks(B3)
GMB Muara Enim III, PHE-BTRAJA MTN

PSC, 01-04,2011, Ons.Eks(B3)
GMB Muralim, DART

PSC, 24-11,2010, Ons.Eks(B3)
GMB Ogan Komering, OIG

PSC, 05-05,2009, Ons.Eks(B3)
GMB Ogan Komering II, EOM

PSC, 04-08,2009, Ons.Eks(B-C3)
GMB Rengat, INDON CBM

PSC, 30-11,2009, Ons.Eks(B3)
GMB Sekayu, MEDCO SEKAYU

PSC, 26-06,2008, Ons.Eks(B3)
GMB Sekayu II, EPHINDO-STAR

PSC, 09-10,2012, Ons.Eks(B3)
GMB Sijunjung, LION - BA

PSC, 01-04,2011, Ons.Eks(B3)
GMB Suban I, PHEM - SUBAN PSC, 12-12,2004, Ons.Eks(B3) GMB Suban II, PHEM SUBAN MG
PSC, 01-04,2011, Ons.Eks(B3)
GMB Tj.Enim, DART

PSC, 08-04,2009, Ons.Eks(B3)
Bengkulu, ECOSSE
PSC, 04-08,2009, Ons.Eks(B3)
121
APPENDIX

AREA II
II.01 II.02 II.03 II.04 II.05 II.06 II.07 II.08 II.09 II.10 II.11 II.12 II.13 II.14 II.15 II.16 II.17 II.18 Karapan, AMSTELCO II.19 PSC,18-05-2010, Ons.Eks(D4) Alas Jati, INSANI BINA P
PSC,09-00-2007, Ons.Eks(D-4)
Babai, KOMODO ENERGY

PSC, 25-05-2012,Ons.Eks(D3-4)
Bangkanai, SALAMANDER
PSC, 30-12-2003, Ons.Eks (E3)
II.20 II.21 II.22

Ketapang, PC KETAPANG II
PSC,11-06-1998, Off.Ept (D4)
Kuala Pambuang, MENTARI

PSC, 19-12-2011, Ons.Eks(C4)
Kuningan, EQUATOR ENERGY

PSC, 25-05-2012, Ons.Eks(C4)
Barito, ALTAR
PSC,12-12-2004, Ons.Eks (E3)
Bawean, CAMAR RESCR.

PSC,21-11-2011, Ons.Eks (B2)
Belayan, GERALDO ENERGY

PSC, 21-11-2011, Ons.Eks (B2)
Bengara I, MEDCO
PSC, 17-09-1999 Ons/Off.Eks(E2)
Biliton, MITRA ENERGY

PSC, 30-12-2003, Off.Eks(D3)
Blora, SELE RAYA ENERGY

PSC, 30-11-2009,Off.Eks(D3)
Brantas, LAPINDO
PSC, 23-04-1990, Ons.Ept(D4)
Bulu, KRISENERGY
PSC, 14-10-2003,Off.Eks(D4)
Cepu, MOBIL CEPU

PSC, 22-12-2006, Ons.Eks(C4)
Citarum, PAN ORIENT

PSC, 22-12-2006, Ons.Eks(C4)
E. Bawean I, EAST BAWEAN LTD.

PSC, 13-11-2008, Off.Eks(D4)
East Kangean, GREENSTAR

PSC, 22-12-2006, Off.Eks (E4)
East Muriah, PEARL OIL

PSC, 13-11-2008,Off.Eks (D4)
East Sepanjang, EASCO

PSC, 13-11-2008, Off.Eks(D4)
INDONESIA PERTAMINA E&P
II.23 II.24 II.25 II.26 II.27 II.28 II.29 II.30 II.31 II.32 II.33 II.34 II.35 II.36 II.37 II.38
Long Hubung L. Bagun, KALISAT

PSC,18-05-2010 Ons.Eks(E2)
Madura, SPE PETRO

PSC, 13-11-2008,Off.Eks(D4)
Madura Offshore, SANTOS

PSC, 13-11-2008, Off. Eks (D4)
Mahakam Hilir, SPC

PSC,13-11-2008, Off.Eks(E3)
Mandala, BUMI HASTA-FORTUNE

PSC, 18-05-2010, Ons.Eks(D4)
Muriah, PETRONAS
PSC, 20-05-1991, Off.Ept(D4)
NE Madura, TECHWIN
PSC, 18-05-2010, OFF.Eks(E4)
North Kangean, PETROJAYA

PSC, 16-01-2007, Off.Eks(D4)
North Madura, HUSKY

PSC, 13-11-2008, Off.Eks(E4)
North Sumbawa II, HUSKY

PSC, 13-11-2008, Off.Eks(E4)
Offshore NW, Java, PHE

PSC, 19-11-1967,Off.Eks(C3)
Off. Lampung I, ANP

PSC, 21-13-2007,Off.Eks(C3)
Ons&Off. Kangean, KANGEAN E.

PSC, 14-11-1980, Ons/Off.Eks(E4)
On&Off Madura Strait, HUSKY

PSC, 20-10-1982, Off, Ept. (D4)
Palangkaraya, PETCON RES.

PSC, 25-05-2012, Ons,Eks(D3)
Pangkah, HESS
PSC,08-05-1996, Off, Ept(D4)
122
SKK MIGAS
2012 ANNUAL REPORT
II.39 II.40 II.41 II.42 II.43 II.44 II.45 II.46 II.47

Pasir, PASIR PETROLEUM

PSC, 05-05-2009, Ons.Eks(E3)
Randu Gunting, PHE

PSC, 09-08-2007, Ons/Off,Eks(D4)
Sampang, SANTOS
PSC, 04-12-2011, Ons/Off, Ept (D4)
Sanga-Sanga, VICO
PSC, 08-08-1998, Ons.Ept, EXT(E3)
Sei Nangka-Senipah, KUTAI ETAM

PSC, 12-12-2004, Ons.Eks(E3)
Sibaru, MITRA ENERGY

PSC,16-10-2007, Off.Eks(E4)
Simenggaris, JOB MEDCO

JOB, 24-02-1998, Ons, Ept(E2)
South Barito, MURPHY

PSC, 27-05-2008, Ons/Off.Eks(D3)
South Bengara II, ACG

PSC, 13-11-2008, Ons,Eks(E2)
II.48 II.49 II.50 II.51 II.52 II.53 II.54 II.55 II.56 II.57
SE. Madura, ENERGI MINERAL

PSC, 05-05-2009, Ons-Off, Eks(D4)
SE. Sumatera, CNOOC

PSC-EXT, 06-09-1998, Off.Ept-EXT(D4)
South Madura, AED

PSC, 14-10-2003, Off.Eks(D4)
Sunda Strait I, NIKO XXVI

PSC, 18-05-2010, Ons .Eks (C4)
Terumbu, AWE
PSC, 05-05-2009, Offs.Eks (C4)
II.58 II.59 II.60 II.61 II.62 II.63 II.64 II.65 II.66 II.67 II.68 II.69 II.70 II.71

West Madura, PHE WMO

JOA, 07-05-1981, Off.Ept(D4)
W.Sangata, KAL.KUTAI ENERGY

PSC, 16-01-2007, Ons.Eks(E3)
W.Tanjung, MRI ENERGY

PSC, 21-11-2011, Ons.Eks(D3)
GMB Bangkanai I, BANGKANAI CBM

PSC, 30-04-2012, Ons.Eks(C3)
GMB Bangkanai II, BORNEO METANA

PSC, 30-04-2012, Ons.Eks(C3)
GMB Bangkanai III, BANGKANAI ER

PSC, 19-12-2011, Ons.Eks(C3)
GMB Bangkanai IV, BANGKANAI JP

PSC, 19-12-2011, Ons.Eks(B3)
GMB Barito, TRANS ASIA&JINDAL

PSC, 30-11-2009, Ons.Eks(D3)
GMB B.Banjar I, INDOBARAMBAI

PSC, 13-11-2008, Ons.Eks(D3)
GMB B.Banjar II, BARITO BG

PSC, 13-11-2008, Ons.Eks(D3)
GMB Barito Tapin, TGM

PSC, 04-08-2009, Ons.Eks(D3)
GMB Belawa, BELAWA ENERGY

PSC, 09-10-2012, Ons.Eks(D3)
GMB Bentian Besar, RIDLAUTAMA

PSC, 26-06-2008, Ons.Eks(E5)
GMB BontangBengalon, DARTE

PSC, 09-10-2012, Ons.Eks(D3)
Titan, AWE, BARUNA & SILLO

PSC, 26-11-2011, Off.Eks(C2)
Tuban, JOB PETROCHINA

PSC, 29-02-1988, Off.Ept(D4)
Ujung Kulon, M3NERGY

PSC, 21-03-2007, Ons/Off.Eks(C4)
Wailawi, PERUSDA BENUA TAKA

PSC, 22-12-2005, Ons.Ept(E3)
II.72 II.73 II.74 II.75
GMB Kapuas I, TRAN ASIA - BP

PSC, 01-04-2011, Ons.Eks(E3)
GMB Kapuas II, KAPUAS - BP

PSC, 01-04-2011, Ons.Eks(E3)
GMB Kapuas III, GMU - BP

PSC, 01-04-2011, Ons.Eks(E3)
GMB Kotabu, SATUI BASIN GAS

PSC, 04-08-2009, Ons.Eks (E3)
Wain, PANDAWA
PSC, 16-01-2007, Ons.Eks(E3)
GMB Kuala Kapuas I, CBM ASIA KK II.76 PSC, 09-10-2012, Ons.Eks (D3) GMB Kuala Kapuas II, BINA MANDIRI II.77 PSC, 30-04-2012, Ons.Eks(E3)
II.78 II.79 II.80 II.81 II.82 II.83 II.84 II.85 II.86 II.87 II.88 II.89 II.90 II.91 II.92 II.93 II.94 II.95 II.96 II.97
GMB Kutai I, KUTAI WEST CBM

PSC, 13-11-2008, Ons.Eks(E3)
GMB Kutai II, EPHINDO-RAE

PSC, 01-04-2011, Ons.Eks(E3)
GMB Kutai Barat, SUGICO

PSC, 01-04,2011, Ons.Eks(E2)
GMB Kutai Timur, SENYIUR - TTL

PSC, 01-04-2011, Ons.Eks(E2)
GMB MelakMendung I, EPHINDO

PSC, 01-04-2011, Ons.Eks(E2)
GMB MelakMendung II, MONNET

PSC, 01-04-2011, Ons.Eks(E2)
GMB Pulang Pisau, SIGMA&BLUE

PSC, 04-08-2009, Ons.Eks(D3)
GMB Sanga sanga, VIRGINIA

PSC, 30-11-2009, Ons.Eks(E3)
GMB Sanga sanga I, SANGA E PSC, 30-04,2012, Ons.Eks(E2) GMB Sangatta I, PHE&SANGAT
PSC, 13-11-2008 Ons.Eks(E2)
GMB Sangatta II, VISI MULTI

PSC, 04-08-2009, Ons.Eks(E2)
GMB Tabulako, ARTHA WIDYA

PSC, 04-08-2009, Ons.Eks(E3)
GMB Tanah Laut, ASAM METHAN

GMB Tanjung II, PHE

PSC, 24-11-2010, Ons.Eks(D3)
GMB Tanjung IV, PHE

PSC, 01-04,2011, Ons.Eks(E3)
Banyumas, LUNDIN
PSC, 17-05-2001, Ons.Eks(C4)
Gunting, EXXON
PSC, 13-11,2008, Off.Eks(D4)
NE.Madura III, ANADARKO

PSC, 12-12-2004, Off.Eks(D4)
Off. Lampung II, PETRONAS

PSC, 22-09-2006, Off.Eks(C3)
Rangkas, LUNDIN
PSC, 27-05-2008, Ons.Eks(C4)
123
APPENDIX

AREA III
III.01 III.02 III.03 III.04 III.05 III.06 III.07 III.08 III.09 III.10 III.11 III.12 III.13 III.14 III.15 III.16 III.17 III.18 III.19 III.20 Ambalat, ENI
PSC,27-09-1999, Off.Eks(E2)
Arafura Sea, COPI

PSC, 13-11-2008, Off.Eks(HI4)
Arguni I, ENI
PSC, 21-11-2011, Off.Eks(HI4)
Aru, NIKO RES.

PSC,25-05-2012, Off.Eks(H3)
Attaka Field, INPEX

PSC,28-03-1991, Ons.Ept-EXT(E5)
Babar Selaru, INPEX

PSC, 21-11-2011, Off.Eks(BHI4)
Berau BP INDONESIA
PSC, 12-02-198, Off.Ept-EXT(H3)
Bone, MITRA ENERGY

PSC, 26-11-2010, Ons.Eks(F3-4)
Bone Bay, MARATHON

PSC, 13-11-2008, Off.Eks(F3)
Bontang, SALAMANDER
PSC, 30-12-2003, Off.Eks(E2)
Budong Budong, TATELY N.V.

Bukat, ENI
PSC, 24-02-1998, Off.Eks(E2)
Bula, KALREZ
PSC EXT, 01-11-1999, Ons.Ept-EXT(H3)
Bulungan, ENI
PSC, 12-12-2004, Off.Eks(E2)
Buton, JAPEX
PSC, 16-01-2007, Ons.Eks(F4)
Buton I, PUTINDO BINTECH

PSC, 13-11-2008, Off.Eks(F4)
Cendrawasih, EXXON
PSC, 05-05-2009, Off.Eks(I3)
Cendrawasih II, REPSOL

PSC, 18-05-2010, Eks(I3)
Cendrawasig III, NIKO

PSC, 18-05-2010, Eks(I3)
Cendrawasih IV, NIKO-REPSOL

PSC, 18-05-2010, Eks(I3)
III.21 III.22 III.23 III.24 III.25 III.26 III.27 III.28 III.29 III.30 III.31 III.32 III.33 III.34 III.35 III.36 III.37 III.38 III.39 III.40
East Bula, BLACK GOLD

PSC, 30-11-2009, Off.Eks(E2)
E. Kalimantan (W.Pasir), CHEVRON

PSC, 25-10-1998, Ons/Off .Ept-EXT(C4)
East Sepinggan, ENI

PSC, 25-05-2012 Off.Eks(E3)
East Simenggaris, SON LAW UC

Enrekang, SIGMA ENERGY

PSC, 21-03-2007, Ons.Eks(E3)
Ganal, CHEVRON
PSC, 24-02-1998, Off.Ept(E3)
Halmahera II, STATOIL & NIKO

PSC, 19-12-2011, Off.Eks(E2)
Halmahera-Kofiau, NIKO XVI

PSC, 30-11,2009, Ons/Off.Eks(G2-3)
Karama, STAT OIL

PSC, 21-03-2007, Off.Eks(E3)
Kasuri, GENTING OIL

PSC, 27-05-2008, Ons/Off.Eks(H3)
Kepala Burung, PETROCHINA

PSC EXT, 15-10-2000, Ons.Ept-EXT(H3)
Kofiau, NIKO
Kuma, COPI
PSC, 16-01-2007, Off.Eks(E3)
Kumawa, MARATHON
PSC, 05-05-2009, Off.Eks(H3)
Kutai, KRISENERGY
PSC, 16-01-2007, Ons/Off.Eks(E2-3)
Mahakam, TOTAL
PSC, 31-03-1997, Ons/Off.Ept-EXT(B3)
Makasar Strait, CHEVRON

PSC, 26-01-1990, Off.Ept(E3)
Malunda, PTTEP
PSC, 18-05-2010, Eks(E3)
Mandar, EXXON
PSC, 21-03-2007, Off.Eks(E3)
Manokwari, ECOSSE
PSC, 12-12-2004, Ons.Eks(H3)
124
SKK MIGAS
2012 ANNUAL REPORT
III.41 III.42 III.43 III.44 III.45

Masela, INPEX
PSC, 16-1-1998, Off.Ept(GH4)
III.61

Semai IV, MURPHY

PSC, 21-11-2011, Off.Eks(H3)
III.81

Talen, TOTAL
PSC, 09-10-2012, Ons.Eks(H3)
Muara Bakau, ENI

PSC, 30-12-2002, Off.Eks(E3)
Semai V, HESS
PSC, 13-11-2008, Off.Eks(H3)
III.62

III.82

Tengah, TOTAL
JOA, 05-10-1988, Off.Ept(E3)
Muturi, BP Indonesia
PSC, 26-08-1992, Ons/Off.Ept-EXT(H3)
Sengkang, ENERGY EQUITY

PSC-EXT, 24-10-2000, Ons.Ept-EXT(F3)
III.63

III.83

Udan Emas, KRIS ENERGY

PSC, 25-05-2012, Ons.Eks(H3)
North Arafura, BP
PSC, 26-11-2010, Ons.Eks(I3-4)
Senoro-Toili (Tomori), JOB MEDCO

JOB, 04-12-1997, Ons/Off.Ept(F3)
III.64

III.84

Warim, COPI
PSC, 26-05-1987, Ons.Eks(I3)
North Ganal, NIKO, STATOIL, ENI & GDF

PSC, 21-11-2011, Off.Eks(I3-4)
Seram, BLACK GOLD

PSC, 13-11-2008, Off.Eks(H3)
III.65

III.85

West Aru I, BP
PSC, 19-12-2011, Ons.Eks(H3)
III.46

N Makasar St, BARUNA & NIKO XIV

Seram Non Bula, CITIC

PSC-EXT, 01-11-1999, Off.Ept-EXT(GH3)
III.66

III.86

West Aru II, BP

PSC, 19-12-2011, Ons.Eks(H3)
III.47

Northern Papua, SARMI PAPUA

PSC, 05-05-2009, Ons/Off.Eks(I3)
III.67

SE. Ganal I, NIKO

PSC, 13-11-2008, Off.Eks(E3)
West Papua I, CHEVRON III.87
PSC, 13-11-2008, Off.Eks(H3)
III.48

Nunukan, ANADARKO
PSC, 12-12-2004, Off.Eks(E2)
III.68

SE. Mahakam, TOTAL

PSC, 21-03-2007, Off.Eks(E3)
III.88

West Papua III, CHEVRON

PSC, 13-11-2008, Off.Eks(H3)
III.49

Obi, NIKO-STAT OIL & ZIMOREX

PSC, 21-11-2011, Off.Eks(I3-4)
SE. Sangatta, SALAMANDER

PSC, 13-11-2008, Off.Eks(E-2)
III.69

III.89

W Papua IV, NIKO XV

PSC, 30-11-2009, Off.Eks(H3)
III.50

Ofs. Timor Sea I, HESS

PSC, 19-12-2011, Off.Eks(I3-4)
SE. Seram, NIKO

PSC, 19-12-2011, Off.Eks(H4)
III.70

III.90

West Sageri, NIKO

PSC, 13-11-2008, Off.Eks(E3)
III.51

Rapak, CHEVRON
PSC, 04-12-1997, Off.Ept(E2-3)
III.71

South Mandar, PTTEP

PSC, 18-05-2010, Eks(E3)
West Salawati, MONTDOR OIL III.91 West Timor, ENI
JOB, 30-12-2003, Ons/Off.Eks(H3)
III.52

Rombebai, AED ROMBEBAI

PSC, 16-11-1998, Ons/Off.Eks(I3)
III.72

South Matindok, BLACK GOLD

PSC, 13-11-2008, Off.Eks(F3)
III.92

PSC, 27-05,2008, Ons/Off.Eks(F4-5)
III.53

Sadang, TALISMAN
PSC, 18-05-2010, Eks(E3)
South Sageri, TALISMAN III.73

PSC, 18-05-2010, Eks(E3)
III.93

Wiriagar, BP
PSC, 27-02-1993, Ons.Ept-EXT(H3)
III.54

Sageri, TALISMAN
PSC, 21-03-2007, Off.Eks(E3)
III.74

South Sesulu, HESS

PSC, 05-05-2009, Off.Eks(E3)
Wokam II, MURPHY III.94 Amborip VI, COPI
PSC, 17-12-2010, Ons.Eks(H3)
III.55

Salawati, JOB PETROCHINA

JOB, 23-04-1990, Ons/Off.Ept(H3)
III.75

SW Birds Head, TOTAL E&P

PSC, 01-08-2011, Ons.Eks(H3)
III.95

PSC, 22-09-2006, Off.Eks(I4)
III.56

Sareba, LUNDIN B.V

Sula I, BRILLIANCE ENERGY

PSC, 30-11-2009, Off.Eks(F3)
III.76

III.96

E. Ambalat, CHEVRON
PSC, 12-12-2004, Off.Eks(E2)
III.57

Sebatik, STAR ENERGY

III.77

Surumana, EXXON
PSC, 18-02,1981, Off.Eks(E3)
Papalang, ANADARKO III.97
PSC, 07-12-2001, Off.Eks(E2)
III.58

Sebuku, PEARL OIL

PSC, 17-09-1997, Off.Ept(E3)
III.78

Tanjung Aru, KRISENERGY

PSC,196-12-2011, Off.Eks(E2)
III.98 Pasangkayu, MIPIL

PSC, 22-09-2006, Ons.Eks(E3)
III.59

Semai II, MURPHY SEMAI

PSC, 13-11-2008, Off.Eks(H3)
III.79

Tarakan, MEDCO
PSC, 14-01-1982, Ons.Ept-EXT(E2)
Popodi, ANADARKO III.99
PSC, 07-12-2001, Off.Eks(E2)
Semai III, SUMA SARANA III.60

PSC, 13-11-2008, Off.Eks(H3)
III.80

Tarakan Offshore, MANHATTAN KI

PSC, 14-10-2003, Off.Ept(E2)
Popodi, ANADARKO III.100

PSC, 27-05-2005, Off.Eks(H4)
125
126
SKK Migas Special Task Force For Upstream Oil and Gas Business Activities Republic of Indonesia Wisma Mulia Building 35th Floor Jl. Jend Gatot Subroto No 42 Jakarta 12710, PO BOX 4775 Indonesia T F E W : +62 21 2924 1607 : +62 21 2924 9999 : hupmas@skkmigas.go.id : www.skkmigas.go.id

SKK Migas Annual Report 2013

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ANNUAL REPORT

ANNUAL REPORT 2012

102 103 104 106 110 112 113 114 117

SKK MIGAS VISION AND MISSION

SKK MIGAS VISION AND MISSION

ANNUAL REPORT 2012

SKK MIGAS CHAIRMAN FOREWORD

ANNUAL REPORT 2012

SKK MIGAS CHAIRMAN FOREWORD

Rudi Rubiandini R.S.

THE HISTORY OF SKK MIGAS

THE HISTORY OF SKK MIGAS

ANNUAL REPORT 2012

BPMIGAS / SKMIGAS / SKK MIGAS MANAGEMENT

SKK MIGAS MANAGEMENT (JANUARY 14th, 2013-PRESENT)

ANNUAL REPORT 2012

BPMIGAS / SKMIGAS / SKK MIGAS MANAGEMENT

ANNUAL REPORT 2012

BPMIGAS / SKMIGAS / SKK MIGAS MANAGEMENT

BPMIGAS MANAGEMENT (UNTIL NOVEMBER 13th, 2012)

ANNUAL REPORT 2012

2012 ANNUAL REPORT SUMMARY

2012 ANNUAL REPORT SUMMARY

ANNUAL REPORT 2012

To support the Governments program in reducing the consumption of subsidized fuel,

2012 ANNUAL REPORT SUMMARY

This agency has conducted a bureaucracy reform to accelerate approval processes.

ANNUAL REPORT 2012

This agency continues to sustain national interest by upholding procurement policies.

To increase national and regional banking capacities (State-Owned and

Procurement commitments in 2012 reached US$16.61 billion with a 60.04% local

2012 ANNUAL REPORT SUMMARY

INCREASING OIL AND GAS RESERVES:

ANNUAL REPORT 2012

ANNUAL REPORT 2012

SKK MIGAS PERFORMANCE

I. SKK MIGAS PERFORMANCE

A. UPSTREAM OIL AND GAS CONTRACT AREA

UPSTREAM OIL AND GAS CONTRACT AREA

Total Contract Area in 2012

ONSHORE 142 CA 36 CA 52 CA 53 CA 1 CA OFFSHORE ONSHORE/ OFFSHORE 112 CA 54 CA 24 CA 15 CA 0 CA 2 CA 74 CA 34 CA 14 CA 3 CA

ACTIVE OIL & GAS CA 161 CA

PRODUCTION EXPLORATION CA CA 75 CA 233 CA

TOTAL CONTRACT AREA 308 CA

ANNUAL REPORT 2012

Yearly breakdown of CBM, production and exploration contract area.

350 308 300 287 54

200 179 172 150 155

0 2010 2011 2012

I. SKK MIGAS PERFORMANCE

A. UPSTREAM OIL AND GAS CONTRACT AREA

Exploration Contract Area

ANNUAL REPORT 2012

Challenges in Fulfilling Firm Commitment

Production Contract Area

I. SKK MIGAS PERFORMANCE

2D and 3D Seismic Surveys in 2007-2012

35,000 31,656 30,000 25,427 25,000

13,550 11,775 8,990 6,997 5,000 KM/KM2 4,776

0 2007 2008 2009 2010 2011 2012

ANNUAL REPORT 2012

Exploration Drilling (Conventional)

Wildcat Discovery in 2012

1200 1000 800 600