Indonesia's state-owned oil company, Pertamina, has expressed interest in investing in Nigeria's upstream oil and gas sector, including producing assets and projects nearing final investment decisions. This development follows discussions between the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) Chief Executive, Mrs. Oritsemeyiwa Eyesan, Indonesia's Vice Minister of Foreign Affairs, Arif Oegroseno, and Pertamina's Vice-President, Upstream Business Development, Toriq Abdat. The talks focused on investment opportunities in Nigeria and broader cooperation between the two countries to strengthen energy security and increase domestic oil production.
Nigeria and Indonesia share similar priorities in energy security, resource utilization, and attracting investment. Both countries are seeking to increase oil production, with Nigeria targeting three million barrels per day by 2030, compared to its current output of about 1.6 million to 1.7 million barrels per day. Indonesia, which produces about 600,000 barrels per day, is also seeking to increase output and has acknowledged the need to look beyond its domestic fields to meet its energy requirements.
Pertamina's international expansion strategy involves seeking opportunities in several countries, driven by declining domestic production and the changing nature of discoveries. The company is interested in assets that can deliver production relatively quickly, including existing producing fields and projects close to production. Pertamina's Vice-President, Upstream Business Development, Toriq Abdat, stated that the company is working on exploration towards deepwater but has found more gas than oil, prompting it to expand abroad.
Abdat mentioned that Pertamina is particularly interested in projects with governments, producing assets, or near production, or before final investment decisions. The company aims to help Nigeria reach its production target of three million barrels per day and, in return, provide more energy for Indonesia's consumption. In response, Eyesan emphasized Nigeria's ambitious production target and its use of regular licensing rounds to expand investment and increase output.
The NUPRC has positioned licensing rounds as a regular source of new acreage for investors rather than an occasional exercise. The Commission's latest round attracted about 300 companies to 50 available assets, with 196 applicants qualifying for the bidding stage. At the close of bidding, 143 companies submitted 200 bids covering 37 assets, resulting in 31 successful companies for 37 oil and gas blocks.
The Indonesian delegation also noted its exploration of opportunities outside crude oil and gas, such as building a fertilizer plant to reduce its dependence on Middle Eastern supply. Nigeria is also diversifying its phosphate sourcing, including a long-term transatlantic pipeline project with Morocco to serve West Africa. Both countries have agreed to keep commercial and diplomatic tracks running in parallel.
The discussions between Nigeria and Indonesia mark a significant step towards strengthening energy cooperation between the two countries. With Pertamina's interest in investing in Nigeria's oil sector, the country may see an increase in foreign investment, which could help it achieve its production target. Key aspects of the cooperation include increasing oil production, improving energy security, and promoting investment in the oil and gas sector.
Key points
- Pertamina's interest in Nigeria's oil sector could lead to increased foreign investment.
- Nigeria and Indonesia are strengthening energy cooperation to achieve their respective production targets.
- The countries are exploring opportunities beyond crude oil and gas, such as fertilizer production and phosphate sourcing.
