Indonesias oil and gas auction system does not sell: Jonan

Jakarta (ANTARA News) – Energy and Mineral Resources (ESDM) Minister Ignasius Jonan said there was little interest in the countrys oil and gas blocks as the auction system offered by the government so far did not sell.

“The model of tender for oil and gas blocks has been like an announcement by an university about acceptance of new students,” the minister said after attending the first Indonesia-India Energy Forum here on Thursday (April 20).

He said the government should invite potential investors and gave them details about the blocks that they would understand and be interested in investing in the blocks.

“I think we lack the skill to sell. The products might be good but we just are not good salesmen,” he said.

Since 2014, few investors have shown interest in taking part in tenders for Indonesian oil and gas blocks. Of 21 oil and gas blocks offered in 2014, only 11 blocks attracted investors. In the next year, there were 8 blocks offered but no investors were interested.

The oil and gas business remained dull until 2016 when 17 conventional and non-conventional oil and gas blocks failed to attract much interest of investors.

None of the three non conventional blocks attracted investor, and only one of the 14 conventional blocks succeeded in attracting investor.

The low interest in venturing in upstream oil and gas industry is also caused by the shrinking oil prices, in addition to red tape.

Source: Antara News