$Unique_ID{bob00243} $Pretitle{} $Title{Indonesia Mining and Energy} $Subtitle{} $Author{Department of Information Republic of Indonesia} $Affiliation{Embassy of Indonesia, Washington DC} $Subject{year fiscal gas production thousand tons development oil energy compared see tables } $Date{1990} $Log{See Table 22.*0024301.tab } Title: Indonesia Book: Indonesia 1990 an Official Handbook Author: Department of Information Republic of Indonesia Affiliation: Embassy of Indonesia, Washington DC Date: 1990 Mining and Energy Policies adopted in this sector aim at continuing and further advance efforts on making inventory, mapping, exploration and exploitation of mineral deposits and energies by utilizing efficient technology to augment production and exports of the resources. Parallel with this, the mining technology is continuously promoted and advanced, while the research and processing of mineral deposits are constantly encouraged. In line with this, education and training is also persistently promoted and ameliorated in order to meet the need for experts and skilled workers. The development of mining is also directed towards the expansion of employment opportunities, diversification of products and augmentation of the supply of raw materials for domestic industries. The private small-scale mining undertakings will also be further encouraged through improvement of procedures, provision of guidance on mining business management, and development of cooperatives in this field. This sector remains one of the country's major income earners. Its notable achievement during the last five years was earmarked by the full operation of oil refineries in Balikpapan (East Kalimantan) and Cilacap (Central Java) together with the completion of a hydrocracker in Dumai (Riau). As the result, since 1986 the country has not had to refine its crude oil production abroad any more and has been no more depending on oil imports. Meanwhile, expansions of LNG (Liquefied Natural Gas) refineries in Arun (Aceh) and Badak (East Kalimantan) have been completed of which the production will rise in the future. In other mining productions, gold and coal experienced a substantial increase. Coal will be used extensively in the coming years to substitute oil. OIL As the result of the decrease of oil price which in turn brought on a slow-down in oil exploration, the country's oil production during fiscal year 1988/89 dropped by 2.17% compared to that of the previous fiscal year namely from 507.95 million barrels to 496.92 million barrels. In the meantime, drilling activities during the first four years of the Fourth Five-Year Development Plan went down, and only in the final year of the said period the situation changed with the signing of 9 new contracts of exploration by the state-run oil company Pertamina with some foreign contractors. These new contracts are hoped to be able to revive exploration activities in the years to come. Up to now there are 73 viable oil contracts comprising 2 joint production, 2 technical assistance contracts and 69 production-sharing contracts. Exports of crude oil and condensation during fiscal year 1988/89 totalled 274.4 million barrels or 0.36% lower compared to that of the previous fiscal year and 22.9% lesser than that of 1983/84. Meanwhile, exports of oil products during the corresponding fiscal year reached 61.1 million barrels, or 7.5% lower than that of fiscal year 1987/88, but 7% higher than that of 1983/84. Sales for domestic consumption during 1988/89 totalled 171,162 thousand barrels, which is 3.7% higher compared to that of 1987/88. In the meantime, the sales of non-oil products such as lubricant, liquefied petroleum gas (LPG), asphalt and wax, also noted an encouraging increase. In addition, some new by-products of oil such as methanol and purified terephthalic acid, have been for the last few years entering the national as well as international markets. GAS The continuous growing of gas consumption in recent years has brought gas production to rise significantly. Apart from being substitute energy of fuel oil for the Balikpapan refinery, Cibinong cement plant and Krakatau steel factory for instance, gas is also used as the basic material for the fertilizer industry. Non-associated gas is used to produce liquefied natural gas (LNG), and associated gas is exploited to become liquefied petroleum gas (LPG). Gas production during fiscal year 1988/89 totalled 1,787 billion cubic feet, or an increase of 2.9% compared to that of the previous year. In the meantime, gas consumption during the corresponding fiscal year was 1,648 billion cubic feet, or a rise of 3.8% compared to that of the previous fiscal year. LNG production also indicates a rising tendency as result of the increased production capacity of refineries on the one hand and the growing demand on the other. A substantial rise occurred during fiscal year 1987/88, namely 11.5% from 811,799.6 thousand MMBTU to 905,150 MMBTU. During fiscal year 1988/1989, LNG production totalled 970,150 thousand MMBTU. Meanwhile, the export of LNG during fiscal year 1988/1989 was recorded at 964,897 thousand MMBTU, compared to 894,955 thousand MMBTU during the previous fiscal year. In fiscal year 1988/1989 export of LPG noted a sharp increase of 176% from 518 thousand tons in fiscal year 1987/88 to 1,430.6 thousand tons. This was attributed to the full operation of Bontang (East Kalimantan) and Arun (Aceh) refineries. COAL The development of coal is primarily directed towards meeting the domestic demands of oil-energy substitution, among others for steam-driven power plant, cement industry, etc. Coal deposits are found in Sumatra and Kalimantan, and exploited by two state-owned companies and five private companies. In fiscal year 1988/1989 the two state-owned companies produced 2,597.7 thousand tons, or a rise by 322.5% compared to that of fiscal year 1983/1984, while the total output of those five companies was 5,195 thousand tons, making the over-all coal production in fiscal year 1988/1989 to rise by 745.2% compared to that of fiscal year 1983/1984. Recent surveys found coal deposits in Aceh, Riau, West Sumatra, West Kalimantan and Central Kalimantan. The country's coal reserve is estimated at 15,500 million cubic metres. TIN The fall of tin price in the world market and the difficulty to market the country's tin production occurring since 1983 have affected the country's tin production of which 95% was exported. Moreover, by the closing-down of the London Metal Exchange (LME) in 1985, the Association of Tin Producing Countries (ATPC) imposed a "supply rationalization" which according to the first Supply Rationalization effective on March 1987 to February 29, 1988, Indonesia was given a quota of 24,516 tons. Meanwhile, the country's tin production in fiscal year 1988/1989 amounted to 28.9 thousand tons, or an increase by 12% compared to that of the previous fiscal year. NICKEL By far nickel ore is found and exploited in Pomalaa (Southeast Sulawesi), Gebe Island, Halmahera Islands (Maluku) and in Soroako (South Sulawesi). Nickel ore found in Pomalaa and Gebe Island is exploited by state-owned company PT Aneka Tambang. Part of its production is processed into ferro-nickel and the remainder exported. Nickel ore found in Soroako is processed into nickel-matte. Production of nickel in fiscal year 1988/1989 totalled 1,881.6 thousand tons, or a slight increase compared to that of the previous fiscal year amounting to 1,782.1 thousand tons, of which 1,607.8 thousand tons were exported. Production of ferro-nickel was 4,833.0 tons of which 4,700 tons were exported. Production and exports of nickel-matte amounted to 30,216 tons and 28,820 tons respectively. BAUXITE Bauxite deposits, found in the islands of Bintan, Tembiling and Dendang in the Province of Riau, are mined and processed by PT Aneka Tambang. During the last few years its production suffered a decline as Japan, the sole buyer country of Indonesia's bauxite production, tends to import aluminum. Unfortunately there is no company in the country yet which processes bauxite into alumina. The production of bauxite which in fiscal year 1987/88 amounted to 654.2 thousand tons, dropped to 514.1 thousand tons in fiscal year 1988/1989. In the corresponding years the exports of bauxite were 686.4 thousand tons and 703.0 thousand tons respectively. GOLD The gold and silver mines in Cikotok, West Java, are exploited by the gold mining unit of PT Aneka Tambang. Gold and silver are also by-products of Freeport Indonesia Inc., which exploits copper in Tembaga Pura, Irian Jaya. Additional gold and silver explorations are also made by smallholders in certain regions in Kalimantan, using traditional equipment. During the last few years interests of private companies to exploit gold deposit rose significantly: 103 joint venture working contracts have been signed, involving 75 national private companies and 38 foreign companies. This surge ascribes to among other things the lifting of gold export prohibition in 1986 and the rise of gold price in the world market. In fiscal year 1988/89 gold production totalled 5,050 kg, an increase of 1,805% compared to that of 1983/84 which amounted to 265.1 kg. COPPER Copper deposit is found in Tembaga Pura, Irian Jaya, and is exploited by Freeport Indonesia Inc. The copper production is entirely exported. Production of copper tends to rise constantly. In fiscal year 1983/1984 the production and exports of copper were 199.7 thousand tons and 202.8 thousand tons respectively, which grew significantly to 302.7 thousand tons and 290.5 thousand tons respectively in fiscal year 1988/1989. NON-FUEL MINERALS Categorized into class C of the non-strategic and -vital mineral resources, the non-fuel minerals in Indonesia make an important contribution to the economy. Non-fuel minerals are mainly exploited by regional government companies and smallholders' companies as well as state-owned companies, and used mainly for industrial raw materials and for building constructions materials. The tonnage extracted of some of the main non-fuel minerals produced in Indonesia is given on the table below: [See Table 22.: Production of Some of the Main Non-Fuel Minerals in tons] ENERGY Development in the field of energy also gets high priority. Policies in this field aim at efforts to find energy resources, diversify power energy resources, manage and utilize energy economically and efficiently and determine sorts of energies appropriate to be used in each sector of development. The development and utilization of coal, water and geothermal as generators of electricity continue to be improved and enhanced. Besides, the use of energy resources such as micro-hydropower, solar energy, biogas, biomass and wind power, maintains to be encouraged and promoted, especially in rural areas. The use of commercial energies tends to increase continuously; if in fiscal year 1984/85 the consumption of energy totalled 227.6 million barrel oil equivalent, the figure rose to 285.7 million barrels oil equivalent, in fiscal year 1988/89 which is an increase of 6.38% annually. In the meantime, the proportion of non-oil energies also saw a meaningful increase from 27.07% to 35.49%. The use of coal grew from 0.8% to 6.12%, that of hydropower rose from 6.15% to 8.19%, and geothermal from 0.18% to 0.56%. On the contrary, the use of oil declined from 72.93% to 64.51%. Studies on the availability of potential of energies suitable for rural areas are being conducted seriously through cooperations involving higher learning institutions to carry out studies on a productive system of utilization and the use of energy resources in rural areas. Campaigns, guidances, studies and trainings as well as other arrangements are constantly conducted in the context to save energies. Studies on energy potentials and follow up measures to save energies have also been done in various industries such as textile, cement, plywood. etc. ELECTRICITY The state-owned electric company is responsible to promote the development and maintenance of an efficient, coordinated and economical system of electricity supply. The policy on the implementation of electricity development is always accorded with policies on the implementation of development in other related fields, such as the general energy policy, regional development policy, etc., while in line with the general energy policy, the policy of electricity development stresses on the use of electric generators utilizing non-oil energy such as coal, water, gas and geothermal. Meanwhile, the Government is also committed to continue the development of rural electricity as it has proved successful in stimulating social and economic undertakings in rural areas. In fiscal year 1988/1989 the villages which had already enjoyed electricity totalled 19,044 out of the 66,594 throughout the country, whereas in fiscal year 1983/84 only 7,637 villages had the facility. In the meantime, up to 1988/89 the number of consumers amounted to 3,425,204. Development of electric power capacity has also been encouraging. During fiscal year 1988/1989, a number of electric power plants with a total capacity of 1,635.95 MW, were completed. They are Mrica hydro-power electric plant, Sengguruh hydro-power electric plant, Cirata hydro-power electric plant, Medan gas-driven power station, Gresik steam-driven power station, Suralaya steam-driven power station, Wadaslintang hydro-electric power plant and Kombin oil-generated power station. In addition, there are also a number of new diesel plants just recently installed in the urban and rural areas, with a total capacity of 110.65 MW. The construction of a 606.66 km transmission network and eight sub-stations with a total capacity of 3,952.5 MVA has also been completed and their distribution network spread over the urban and rural areas. The expansion work comprised of medium tension network of 5,037.27 km and low tension networks of 4,014.75 km, in addition to the construction of 4,628 distribution sub-stations with a total capacity of 321.6 MVA. The above mentioned physical development has indeed brought on a significant rise of electricity supply. The output capacity in fiscal year 1988/1989 totalled 25,622,755 MWh which is an increase of 14.9% compared to the 22,305,912 MWh of the previous fiscal year. Meanwhile, the sales of electricity rose to 19,990,700 MWh in fiscal year 1988/89 which is 17.1% of the 17,076,800 MWh in fiscal year 1987/88. The installed connecting capacity grew by 18.5% from 10,710.7 MVA in fiscal year 1987/88 to 12,695.6 MVA in fiscal year 1988/1989, while the number of consumers increased from 8,203,349 to 9,250,095 which is an addition of 12.8%. CITY GAS The policy of development on the distribution of city gas is more directed towards the expansion of city gas network. In the context of augmenting the supply and utilization of gas for cities in Java Island which have gas networks, and those in other regions which are prospective for the development of city gas installations, the main target in expanding city gas networks is the large number of consumers to minimize unit cost. At present, natural gas is only consumed in Jakarta, Bogor, Medan and Cirebon, while the kind manufactured from coal or petroleum is used in the cities of Bandung, Surabaya and Semarang. A feasibility-study is being conducted for the possibility to consume natural gas instead of manufactured gas in Bandung and Surabaya. The physical development of city gas still concerns upgradings of the installed capacity, covering transmission pipelines (high pressure) and distribution pipelines (low pressure). In the period 1983/1984 to 1988/1989, the gas city installed capacity grew at an annual average of 5.7%. In fiscal year 1988/89 alone the daily installed capacity managed by state-owned gas company, Perum Gas Negara, totalled 3,692,312 thousand cubic metres compared to 2,831,440 thousand cubic metres in 1983/84. In the meantime the distribution network has reached 1,377.16 km. The production of city gas shows a promising increase; if in fiscal year 1987/1988 it amounted to 202,331.19 thousand cubic metres, in fiscal year 1988/1989 it rose to 247,415.60 thousand cubic metres, which is about 22.3%. The rise of production was followed by the increase of consumption. In fiscal year 1988/89 223,861.40 thousand cubic metres was consumed an increase of 24.4% compared to that of the previous fiscal year.