Indonesia sees higher oil, gas lifting in 2027: regulator chairman

Indonesia expects oil and gas lifting to increase in 2027, supported by activities such as drilling, well intervention programs and upstream projects, upstream regulator SKK Migas Chairman Djoko Siswanto told lawmakers June 3.

Oil lifting is projected to be 602,000-615,000 barrels/day in 2027, compared with a forecast of 602,000-610,000 b/d in 2026. Gas lifting is forecast at 934,000-977,000 barrels of oil equivalent/day, up from expected volume of 929,000-933,000 boe/d this year.

"We are quite optimistic that production can reach around 610,000-615,000 b/d in 2027," Siswanto said during a parliamentary hearing, adding that SKK Migas is using a midpoint projection of around 612,500 b/d for oil, condensate and natural gas liquids lifting next year.

Existing fields are expected to contribute about 491,000 b/d, while drilling, workovers, well services and LPG/NGL projects are expected to add more volumes, he said.

For gas, lifting is projected at 5,469 million standard cubic feet/day in 2027. The additional supply is expected to come from drilling and capital projects, including those operated by Italy's Eni.

The outlook comes amid challenging outputs so far in 2026. Total liquids production stood at 576,200 b/d as of May 31, consisting of 491,300 b/d of crude oil, 55,800 b/d of condensate and 29,100 b/d of NGL. However, SKK Migas is optimistic that the full-year production outlook will remain at 610,000 b/d, Siswanto said.

Gas performance has been better. Production reached 6,550 MMscf/d through May, while gas deliveries stood at 5,207 MMscf/d. SKK Migas expects gas deliveries to reach 5,400 MMscf/d in 2026 with production at 6,787 MMscf/d, he said.

Siswanto said oil output this year was hit by several operational issues in the first five months. A pipeline leak in January affected seven upstream contractors and temporarily disrupted production.

In the first quarter, for example, there was a pipeline leak owned by PT Transportasi Gas Indonesia (TGI), which affected seven production-sharing contractors, as well as two other gas suppliers, he said.

Production later recovered but was again pressured by electricity problems at Pertamina Hulu Rokan (PHR) and declining output at ExxonMobil Cepu's Banyu Urip field.

"These two blocks are the biggest contributors to our national oil production," Siswanto said.

PHR produced around 131,000 b/d through May, or about 80% of its target. ExxonMobil Cepu produced 129,915 b/d, equal to about 87.5% of its target.

Siswanto said PHR's problems were mainly related to surface facilities and electricity supply. At Cepu, the issue was reservoir-related.

"After drilling, oil declined very fast, and what comes out now is more water and gas," he said.

At the same meeting, PHR President Director Muhammad Arifin said power supply problems have been affecting operations since late 2025. He noted that the company is still working with PLN to fix the issue, with restoration efforts expected to be completed by around July 2026.

Meanwhile, Senior Vice President of ExxonMobil Indonesia Muhammad Nurdin said the decline in production at Cepu block was caused by technical issues. He said ExxonMobil had been making efforts, including intensifying exploration and optimizing the use of newly identified oil reserve points.

'Triple 100' program

To close the production gap, SKK Migas is pushing its "Triple 100" program, which targets an additional 5,000 b/d this year. So far, the program has added around 250 b/d.

SKK Migas also collected community-operated wells. Nine regional enterprises and small businesses have joined the program, adding about 1,500 b/d. The potential is estimated at around 22,000 b/d, he said.

Exploration activity is expected to rise in the second half. Only five exploration wells had been drilled by May, or about 13% of the annual target. Siswanto said another 34 exploration wells are planned this year.

Development drilling is also expected to accelerate. Of the 832 development wells planned this year, 215 had been drilled by May. That leaves 617 wells to be completed.

"Development wells generally succeed. We target a minimum of 100 barrels per well," Siswanto said.

SKK Migas estimates cost recovery at $8.5 billion-$9.9 billion in 2026 and $10.1 billion-$11.5 billion in 2027. The government assumes an Indonesian Crude Price of $86/b this year and $80/b next year.

Siswanto noted that SKK Migas was expecting groundbreaking at the delayed Abadi Masela Project in June. S&P Global Energy CERA estimates the Abadi field has sufficient resources to support a 9.5 million metric tons per annum project, and expects the first gas to come online in the late 2030s.

He also asked lawmakers to support faster permitting and regulatory certainty for upstream projects. "Exemptions from some permits would greatly help us achieve the drilling target," he said.