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il and gas companies are increasingly reluctant to keep exploring for new deposits as oil prices remain at an all-time low.

The benchmark West Texas Intermediate (WTI) crude oil price stood at US$43.01 per barrel on Tuesday afternoon according to figures from Bloomberg, a 24 percent year-on-year decrease from $56.99.

Meanwhile, the fellow benchmark Brent Crude recorded a $44.86 per barrel price.

Due to the consistently low prices, companies have started to proceed with caution. Data from the Energy and Mineral Resources Ministry show that 7,281 2D and 3D seismic surveys were conducted last year compared to the 14,414 surveys conducted in 2014.

Furthermore, the same data shows that only 52 exploratory wells were drilled last year resulting in a mere 15 discoveries, compared to 83 wells with 25 discoveries in 2014. The number of wells drilled dropped significantly when compared to the average of 104 wells drilled per year from 2011 to 2013.

Up to 10 exploratory wells were drilled from January to April this year, which produced three discoveries.

The exploration slowdown has not just been limited to a lack of drilling and surveys. Because of a lack of funds, as many as 11 companies have decided this year not to extend contracts that are due to terminate within the decade. Furthermore, only one company has filed for a contract extension by April.

The lack of exploration may lead to national oil and gas production dropping to 1.5 million barrels of oil equivalent per day (boepd) within the next decade. The country produced on average 2.3 million boepd in its first quarter this year.

“The decline rate of oil wells in Indonesia is above 20 percent every year,” The Energy and Mineral Resources Ministry’s director general for oil and gas, IGN Wiratmaja Puja, said on Tuesday.

However, Wiratmaja confirmed that the ministry was considering several incentives to lure companies into extending their contracts, including the possibility that companies would not have to pay taxes during the exploration period.

“For example, during the exploration period they would not have to pay land and building taxes [PBB], taxes on imported equipment and other similar taxes. Currently, only the PBB has been scrapped,” he said.

Furthermore, the ministry is also considering changing the current scheme to a national-based one from a block-based one so that the revenues from what is extracted from one oil or gas field could cover the exploration activities at another.

Decreased exploration will not bode well with the country’s growing demand for oil. This year, the national demand has been predicted to reach 1.6 million barrels of oil per day (bopd), far higher than the country’s production capacity of only about 800,000 bopd.

The ministry estimated that Indonesia had oil and gas reserves of 7.018 billion stock tank barrels (mmstb) and 148 trillion standard cubic feet (tcf), respectively, in this year’s first quarter.

Meanwhile, Total E&P Indonesie acknowledged that it had decided to decrease the number of production and exploratory wells it would drill this year to 36 from last year’s 107 as it was currently not economically feasible to drill any more than the targeted figure.

“This year we will continue to drill 36 wells, whereas we drilled 107 wells last year. We are trying to accommodate the current economic situation,” Total E&P Indonesie’s vice president for corporate communications, human resources and finance, Arividya Noviyanto, said.

The company has also decided to stop production from wells that have been deemed economically unfeasible this year in order to increase efficiency.

Last year, Total E&P produced 69,800 bopd and 1,686 (mmscfd) from its six oil and gas blocks.

Arividya also said that Total E&P Indonesie has decided to relinquish the South Sageri Block to the government and was prepared to pay the fine for dropping out of the contract early as it did not make economic sense to continue. The company stopped exploration activities in the block last year after drilling three wells.

The company has already notified the Upstream Oil and Gas Regulatory Special Task Force (SKKMigas) that it would, as well, not extend its contract on the Tengah Block, which is set to expire in 2018.