Abstract

During 1981 and 1982, 473 new exploration wells had been drilled and 10 thousand kilometers of seismic lines had been recorded in the Indonesian Basins. New geologic synthesis were put forward. Some of them have led to a number of new discoveries. These activities were backed-up during the last 15 years by capital support with cumulative expenditures amounting close to half a billion US dollars. Despite that, more investments will still be required for further development, and more bigger future exploration costs will have to be spent. Such massive capital investments apparently need careful handling from both the host country and the investors, in the face of current economic situation and especially in the face of geological risks involved. It is therefore desirable, that decisions involving future investments could be eased as much as possible from the risks they have to carry.

Being a host country, Indonesia accommodates external financial support, and intends to maintain a healthy investment "climate" appropriate for foreign investments. During the last 15 year of its life, the Indonesian petroleum industry offers various incentives, intend to meet investment demands for less and less risk an returns. Yet another new risk-reducing device is still being introduced, mainly to deal with geological uncertainties inherent with exploration decisions.

The approach has been designed to encourage a wide range of possibilities, from limited studies of general level pertaining to geology, economics and engineering up to in-depth study of specialized nature such as petroleum geochemistry, source rock study, etc.

Since decision common to exploration ventures implies basinal geology, such study could be extended into a joint study on basinal level. These joint efforts thus visualized may be appropriate in reducing investment risks in the basin, and therefore could also be regarded as an investment incentive.

Introduction

Modern exploration campaigns in the Indonesia Basins started as early as 1961 when ASAMERA was awarded almost 3910 square kilometers of contract area in North Sumatra onshore (Figure 1).

During the last 15 years, the activity has increased steadily. The amount of exploration expenditures in 1982 was twenty times higher than those of 1977 (Figure 2). The cumulative footage drilled by 1982 amounted to 13,500,000 meters, out of 1943 wells. The intensity of seismic survey indicated similar picture. The cumulative length of seismic lines recorded since 1967 amounted picture. The cumulative length of seismic lines recorded since 1967 amounted to 725,000 km, out of which 114,000 km were acquired in 1980-1982 (Figure 3).

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