The Jakarta Post
Energy and Mineral Resources Minister Ignasius Jonan has said the increase in oil and gas imports was triggered by the significant increase in consumption, while domestic production could only increase gradually.
He was responding to President Joko “Jokowi” Widodo’s criticism of the increase in oil and gas imports that was responsible for the trade deficit in 2018 and the first five months of 2019.
Jokowi’s criticism was made in a Cabinet meeting on Monday, attended by Jonan and State-Owned Enterprises (SOEs) Minister Rini Soemarno, in which the President said oil and gas imports made the largest contribution to the US$2.14 billion trade deficit in the first five months of 2019.
“Oil and gas [imports] have increased greatly. The energy and mineral resources and state-owned enterprises ministers are the ones who deal with the matter.,” Jokowi said as quoted by tempo.co.
Jonan said fuel consumption had increased significantly in line with the development of roads across the country, while oil and gas production could not be increased within a short period of time.
He said large-scale exploration had only started in recent years and needed the commitment of large oil companies, including state-owned energy holding company Pertamina.
Jonan explained oil production was at 775,000 barrels per day but consumption was 1.3 million barrel per day.
Meanwhile, gas production was at 1.2 million barrel of oil equivalent per day, 65 percent of which was for domestic consumption.
“Oil consumption has continuously increased in line with the increase in the number of vehicles. That is why the ministry hopes there will soon be incentives for the development of electric cars,” he said.
He added if the majority of natural gas was exported like before 2000, there would be no oil and gas trade deficit. (bbn)