Indonesian Energy Minister urges Pertamina to acquire stakes in oil and gas blocks in Azerbaijan

Baku. 10 March. REPORT.AZ/ Aware that domestic oil reserves are limited, the government would like state-owned oil and gas giant Pertamina to manage oil and gas blocks abroad. One country with the potential for this plan to work is Azerbaijan.

Report informs citing the Indonesian media, Indonesian Energy Ministry is currently urging Pertamina to acquire oil and gas blocks in Azerbaijan, an oil-rich state nestling between West Asia and Europe. Potential oil supply from this country is more than 50 million barrels.

“Also, operational and production costs in Azerbaijan are reasonable,” the ministry’s Director General for Oil and Gas Affairs, I.G.N. Wiratmaja Puja, said.

He mentioned that Pertamina could learn from Petronas’ move into Azerbaijan, where the Malaysian oil and gas firm is acquiring part ownership in oil and gas blocks.

Azerbaijan produces 800,000 barrels of oil per day. This is comparable to the amount of oil Indonesia produces, but the difference is that Azerbaijan has a much smaller population. Daily oil consumption there is just 200,000 barrels, and the remainder is exported. Indonesia, meanwhile, does not produce enough oil to meet daily demand.

Since last year, the government has been importing crude oil directly from Azerbaijan. So it would be a great opportunity if Pertamina, which was also involved in this business arrangement, could acquire stakes in oil and gas blocks there. 

Sudirman Said, the Energy Minister, confirmed this and claimed Azerbaijan has already committed to supplying 1 million barrels of oil per month. Syamsu Alam, Pertamina’s Upstream Oil and Gas Director, also supports the plan and has suggested that the oil from Azerbaijan might be used to supply Pertamina’s Cilacap refinery.