Pertamina Ep Profile z3258

COMPANY PROFILE

EP COMPANY PROFILE

foreword

messagefrommanagement

PT PERTAMINA EP or PEP is one of the

When PT Pertamina EP began its transformation journey in 2006, Indonesia’s

most prominent oil and gas producers

economic situation was remarkably motivating. The year was decorated with

in Indonesia, will strive to put its best

various records of success, yet also painted with numerous challenges that made

efforts in undertaking the nation’s duty

us more experienced in managing the company.

to fulfilling the needs of Indonesia’s community at large.

At early 2006, the country still experienced a carry-over economic burden from the previous year due to oil price increase, which in turn resulted in higher prices.

With endless waves of ionate

All the while, non-fundamental factors such as geopolitics and market speculation

enthusiasm, PEP commits

conspired in soaring global oil price trend. Thus, oil and gas industry has continued

to constantly increase its

to appear very prospeting and optimistic in nature.

exploration and production undertakings through

It was within such situation that Pertamina EP sets its transformation pace in motion.

proper implementation

The transformation program was designed to resolve technical problems and

of Good Corporate

simultaneously answer the socially situational pressures.

Governance to achieve the

With average production growth of 6-7 percent in the past three years, we have

desired-end-state,

high optimism to continue growing and answering both government and people’s

‘PEP WORLD

challenges to escalate our national oil and gas production.

CLASS’.

Tri Siwindono (President Director)

PEP EP COMPANY PROFILE

02

vision

corevalues

In becoming the foremost oil and gas producer, PT PERTAMINA EP (PEP) has split its

Highly respecting the corporate ethical values throughout our behavior.

visionary aspirations into a three-year strategic planning period, each of which is aiming to become: ”Respectable Cost Cost-Effective and Efficient Oil & Gas Producer” (for 2006-2008), ”Number 1 Oil & Gas Producer in Indonesia” (2009-2011) and ”PEP World Class” (2012-2014).

mission While reaching the set objective, PEP consistently strives to run the oil and gas business efficiently, effectively, and within a safe and healthy environment, thus increasing value

It has been PEP commitment to constantly foster standard ethical behavior and to implement professional business ethics throughout internal and external interactions. Such behavioral sandards, that we call core corporate values, have been perceived as fundamental as well as strong groundwork of a continuous relationship with the stakeholders. The values consist of focus, integrity, visionary, excellence, mutual respect, good corporate governance, optimization, personal quality, empowerment, peerless shareholder value and proper HSE.

for the stakeholders.

PEP EP COMPANY PROFILE

04

17 September

ourmilestone

13 September 17 September

2003

year of

2001

Government issued Oil and Gas Law No. 22 Year 2001.

20 August

1968 PERMINA merged with PERTAMIN into PERTAMINA.

10 december

1957 Establishment of PT Perusahan Minyak Nasional (PERMINA).

The g of Coorperation Contract between PT PERTAMINA (Persero) and BP MIGAS on all Oil and Gas Mining Authority Zone.

2005

The establishment of Pertamina EP.

2005

The g of Coorperation Contract that established PERTAMINA EP working areas

Business wise, the voyage of Pertamina EP

to establish separate business subsidiaries

is interrelated with its mother company,

so that the business of exploration, exploitation

PT Pertamina (Persero). In harmony with global

and production of oil and gas become

and national oil and gas industry dynamics,

more managable.

PT Pertamina (Persero) has undergone several changes in name and status. It started with

It was on such ground that Pertamina EP was

the establishment of PERMINA in 1957,

established on 13 September 2005. Then on

which \turned into PERTAMINA after merging

17 September 2005 PT Pertamina (Persero)

with PERTAMIN in 1968. In 1971, the government

signed a Production Sharing Contract (PSC)

issued Law No. 8 that positioned PERTAMINA

with BPMIGAS, governing all oil and gas mining

as state-owned oil and gas company.

areas accordingly. Eventually, majority of those areas became Pertamina EP’s working areas,

As oil and gas environment continues to shift,

including those previously managed by

the government responded by issuing Oil and

PT Pertamina (Persero) through Technical

Gas Law No. 22 Year 2001 which altered the

Assistance Contract (TAC) and t

status of PERTAMINA into a State-Owned

Operating Body Enhanced Oil Recovery

Enterprise, which renamed PT Pertamina

(JOB EOR).

(Persero), with separate Directorates for the upstream and downstream businesses. The law also urged PT Pertamina (Persero)

PEP EP COMPANY PROFILE

06

businessfocus PEP strives to transcend maximum efforts and synergy throughout all levels of the organizationin order to achieve excellent outcomeat the end of the day.

corebusiness PT Pertamina EP (PEP) is an operating subsidiary business unit that focuses on managing the upstream oil and gas production through a more manageable exploration and exploitation

indicate

activities. Adding to that, PEP has been

120 thousand

undertaking other ing businesses, which

of barrels oil per day (BOPD)

have been intended to back up the main business

and 1,000 million standard cubic

directly or indirectly.

feet per day (MMSCFD) of gas.

Soon after its establishment on 13 September

ed with the above capacity of oil

2005, PEP has been dedicating to undergo

production, PEP feels confident to reach

its core business with strong commitment,

the raw oil production targeted by the

to work hard and be productive, have motivated

government for export. Meanwhile,

PEP in elevating Indonesia’s position as a net

PEP’s gas production is fully produced

oil importer. Consequently, PEP has strived to

to domestic industry needs, as part

constantly increase the oil and gas production

of PEP’s contribution to add to Indonesia’s

capacity, to which its daily capacity of production

competitive advantages within the industry.

PEP EP COMPANY PROFILE

08

The following illustrates PEP’s production of oil and gas:

1007

1100 870 785

800

980

900

1030

1000

1120

1200

600

400

legend:

200

oil gas 0 year 2005

year 2006

year 2007

year 2008

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The following illustrates PEP’s top 10 oil and gas producer:

490.879

Chevron Pacific Indonesia

118.91

2554.32

83.119

ConocoPhillips Ltd.

76.854

Total

Total

1070.77

Pertamina + JOB + TAC

Pertamina

1031.99

ConocoPhillips Ltd.

747.88

48.441

PetroChina Int. Ind. Ltd.

494.06

45.673

CNOOC (SES) B.V.

287.24

41.898

Medco E & P Indonesia

285.99

38.863

Chevron Indonesia Company

170.61

ExxonMobil Oil Indonesia Vico PetroChina Int. Ind. Ltd. Chevron Indonesia Company CNOOC (SE) B.V.

28.941

BOB Bumi Siak Pusako Pertamina Hulu

150.91

Premier Oil

23.627

BP Indonesia

123.53

Medco E & P Indonesia

0

100

200

300

400

500

Top 10 Oil Producer

0

500

1000

1500

2000

2500

3000

Top 10 Gas Producer

In accordance with the Technical Assistance

working areas, respectively; all stretched

Contract (TAC) and t Operating Body

from Sabang to Merauke as marked on the

Enhanced Oil Recovery (JOB EOR), PEP’s

following operation map:

EP COMPANY PROFILE

BLOCK UDANG

NORTHERN SUMATRA

BLOCK TARAKAN BUNYU

BLOCK SANGATTA BLOCK SANGA SANGA BLOCK LIRIK

BLOCK SORONG

BLOCK TANJUNG

BLOCK JAMBI CENTRAL SUMATRA BLOCK MATINDOK

BLOCK TIMOFORO

BLOCK KAMUNDAN & WIRIAGAR

SOUTHERN SUMATRA

WESTERN JAVA EASTERN JAVA

SUMATRA

EASTERN INDONESIA

JAVA

At this stage, PEP owns four main

Capacity wise, total production

01

Perlak

01

Sanga-sanga

01

Lapisan L. Parigi

backbone fields for their high

of Tambun field is 14,000 BOPD,

02

NAD Area

02

Sangatta

02

X-Ray

production capacity.

Limau field is 8,000 BOPD;

03

West Sakakemang

03

Bunyu

03

Jabati Area

As a consequence, any impacts

Sukowati field is 19,000 BOPD,

04

East Sakakemang

04

Matindok

04

Western Java

05

Kluang Siarak Area

05

Sele

resulted from those fields will

and Poleng field is 8,500 BOPD.

06

Suban

06

Klamono

eventually affect the whole PEP

In total, all the four main fields

07

Southern Sumatera Area

07

Timoforo Area

production. The four working

contribute 49,500 BOPD or

08

Udang

08

Wiriagar

fields are Tambun, Limau,

40 percent of the targeted

09

Kemundan

Sukowati and Poleng.

125,000 BOPD.

UBEP 01

Lirik

02

Jambi

03

Limau

04

Benakat

05

Tanjung

06

Sangasanga & Tarakan

COMPANY PEP COMPANYEP PROFILE 10PROFILE

marketposition PEP aims to be the number one oil and gas producer in Indonesia in 2011, by optimizing its largest oil and gas reserve. Today, PEP is the second biggest oil and gas

The third focus is to reactivate old wells on the

producer in Indonesia, with its total oil and

production fields, while reactivation of old fields

gas production has reached 400,000 barrel oil

comes as the fourth focus. The reactivation

equivalent per day (MBOEPD).

initiatives seem potentially promising to adapt while adjusting with the fluctuative increase

While on the reserve side, PEP holds

of the oil price.

the largest oil and gas reserve in Indonesia, totaling at 6,171 MMBOE, also the third largest in Asia Pacific.

Focusing on extracting and filtering of condensate gas transmission pipes, intensifying Enhanced Oil Recovery (EOR), and Put on Production (POP) for exploration wells come as the fifth, sixth and

PEP is the only one amongst five major Cooperation Contractors who is confident to attain 2008 oil and gas production target set by the government.

seventh focus, respectively. Another strategic program includes acquisition of 3D seismic data that aims to obtain a more accurate 3D seismic data needed for the development of production field and EOR

strategy

application; all 3D seismic programs have located ± 2,700 km2 areas.

Various strategic programs have been

Meanwhile, other strategic programs include:

developed to the

accelaration of KSO cooperation; speeding up

company’s growth. One of those

unitization; resource intensification, accelerating

is 7 Focus Point, which has been

resource verification; and other daily operational-

strategically implemented since 2008.

related initiatives.

Firstly is to focus on securing production of the main fields, considered as the backbone of all PEP production activities. Next is to focus on optimalization of production by way of improving infrastructure and ing facilities of the existing fields, aiming at enhancing production level of those fields.

EP COMPANY PROFILE

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PEP EP COMPANY COMPANY PROFILE PROFILE

12

corporatestrengths Production has reached 80% of the ultimate primary recovery level and the estimated oil reserves totaling at 5 billion barrels of oil (BBO). ourpeople Employees of Pertamina EP (PEP) are

relied upon as the country’s revenue generator.

professionals who are selected through a

That’s the reason why human resource

strict and accurate process. In addition, their

(HR) improvement has become

capabilities are continuously enhanced to shape

a constant necessity.

them into enthusiastic people who posses a lasting and competitive uniqueness, professional

HR development of PEP emphasizes on increasing

interpreneurship spirit and of high moral.

personal quality and empowerment by meeting the World Class People standards. Our journey

These moralities are essential since PEP

to build world class employees began with

workers are fighters/warriors who persistently

some initial projects carried out during early

transformation phase, namely Talent Management

therefore all employees have equal

and Succession Planning.

opportunities for self-development.

Talent Management is a founding guidance for

Succession Planning, is a tool for planning,

potential employees or those with extra skills

preparing of employees’ career path and

to be developed as the company’s key players.

development, as well as cadre monitoring

This guidance is a tool for company leaders in

and evaluation. Cadre development has

developing and selecting officials to take up

begun since entry level and will be monitored

key positions. Since it is based on meritocracy

on a constant basis.

Therefore, rigorous, sustainable, and comprehensive programs aimed at developing professionalism among our employees, have been continuously implemented throughout our growth.

PEP EP COMPANY COMPANY PROFILE PROFILE

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differentiation With 140,000 km2 of working area, PEP is a

Pertamina EP divides its working areas into three

Contractor of Cooperation Contract operating

regions, Sumatera, Java and Eastern Indonesia

on the most widespread area in Indonesia.

Region. The head office manages the entire

This also means that PEP owns 20 percent

JOB EOR and TAC operations, while each

shares of national oil reserve and 10 percent

region manages their own operation.

of national gas reserve. These potentials will eventually turn Pertamina into the largest oil

The operation of three regions is divided into

and gas producer in Indonesia.

12 Field Areas namely Rantau, Pangkalan Susu, Lirik, Jambi, Prabumulih and Pendopo

Meanwhile, production is projected to increase

in Sumatera Region, Subang, Jatibarang and

to 684 MBOEPD in year 2014, double from the

Cepu in Java Region and Sangatta, Bunyu

2007 production of 350 MBOEPD.

and Papua in Eastern Indonesia Region.

operations

Beside managing the previously mentioned

To manage its oil and gas working areas,

areas through projects, namely gas development

PEP conducts own operation and partnership

project of Pagar Dewa in Sumatera, Gundih in

cooperation in form of t Operating Body

Central Java and Matindok in Sulawesi.

working areas, PEP also manages its working

Enhanced Oil Recovey (JOB EOR) and Technical Assistance Contract (TAC).

Throughout its operations as a subsidiary of PT PERTAMINA (PERSERO), PEP total oil production has contibuted majorly to the national’s oil reserve.

EP COMPANY PROFILE

corporatecommitment PEP is committed to striving for the best in all its business activities, including HSE performance.

independent corporate management practices

could cause conflicts and pressures, internally

comes as the second aim. The third is developing

or externally, that are not in accordance with

a specific decision making system by all

prevailing rules and regulations, as well as

Business Units based on high ethical codes

healthy corporation principles.

and strict compliance to the set regulations and

goodcorporategovernance

business codes. Realizing the Corporate Social

Clarity in describing each business unit’s

Responsibility program to the stakeholders and

functions, duties and responsibilities in order

Proper implementation of Good Corporate

Firstly, it aims to maximize the corporate values

escalating a conducive national investment

to manage the company more effectively

Governance (GCG) aims to strengthen corporate

by aggressively applying the principles of

climate, particularly in energy and petrochemical

is principle of ability that PEP holds

image as well as performance, while maximizing

transparency, independency, ability,

areas are the fourth and fifth aim.

strongly. Principle of Responsibility implies

the shareholder’s values at the same time. Within

integrity and adequacy throughout all corporate

PEP, GCG implementation has five aims.

conducts. Ensuring a professional and

appropriateness of company’s management Throughout all conducts, PEP holds Good

practices to prevailing rules, in a way that

Corporate Governance principles such as

also complies with healthy corporation

Transparency, which is open and honest in all

principles. And lastly, principle of Fairness

decision making process, while assuring that

understood as being fair and equal treatment

any financial related information is relevant and

in meeting the stakeholders’ rights as

accurate. Principle of Independency states

the stated by the prescribed rules

that employees must avoid situations which

and regulations.

We believe that proper good governance implementation is the foundation of our movement, with the spirit of integrity and rightness, to being the foremost national oil and gas producer of a world-class state of mind.

PEP EP COMPANY COMPANY PROFILE PROFILE

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healthsafetyenvironment Moreover, preserving the green nature of the surrounding environment has also been our main endeavor in creating a healthy and clear atmosphere. At PERTAMINA EP (PEP), Health, Safety,

for PEP to reach ‘HSE Operating Excellence’.

and Environment (HSE) initiatives have been

The 13 elements include ideal leadership and

undertaken to ensure adequate management

integrity; awareness, training, competency;

performance and practices. HSE practices ensure

partnership management, design, construction

that risks to both people and the environment

and commissioning; operation and after operation

are addressed, as well as enhancing social

management; inspection and maintenance;

growth of the surrounding community.

security management (materials and products); management of change; communication; crisis

Going world class, PEP realizes that HSE

and emergency handling; incident investigation;

implementation is inseparable from all business

documentation; and evaluation and audit.

aspects. In due course, PEP strives to sustainably improve its understanding of the HSE culture,

PEP commits to bring about respectable HSE

so that the HSE initiative can be merged into

practices in accordance to the applied regulations

the primary corporate culture through integrated

and HSE standards. The objective is to minimize

HSE Management System that is integral and

incidents, actively anticipate the negative impact

will synchronize all business operations.

resulted, and improve the company’s image.

More importantly, the system will bring about a more safe, excellent, efficient and environmental

However, proper implementation of HSE

concern operations.

Management System throughout PEP and partners’ operations is one of the developed

A set of HSE Management System emphasizes

five strategies. Other strategies include special

on 13 major elements has been made effective

HSE workshop for workers, making HSE

by PEP to affirm that it is the duty and

practices inseparable from the corporate culture,

responsibility of everyone in the company.

integration of the required technology with PEP’s

Therefore, proper HSE implementation

operations, and strengthening the corporate

throughout all layers is a compulsory action

image throughout all aspects of HSE.

PEP EP COMPANY PROFILE

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corporatesocialresponsibility Intense interactions with the local people and regular community development initiatives have initially been PEP’s moral obligation ever since our early establishment. PEP realizes that the and involvement of the local community play an important role throughout our business sustainability and hence our growth. As part of the community, PT PERTAMINA

its economic, social, and cultural

EP (PEP) is committed to actively express

perspectives through Corporate Social

its social responsibility and to create an

Responsibility (CSR) program. Besides,

environmental friendly operations. Likewise,

PEP also considers the CSR program

PEP believes that positive social perception

as part of its business investment

is good for business, providing a secure,

initiatives for growth, ensuring

inspiring and dynamic atmosphere.

future business.

Realizing its responsibility to the community,

It is PEP commitment to empower the

PEP knows that community development is a moral obligation, a way of showing concern and earning trust. Hence, PEP feels obliged to share

local community and protect the areas of its operations to develop a conducive community relationship and to take responsive action in handling after-mining impact. As a result, the CSR activities are realized through a number of programs focusing on religious, health, education and economy related issues.

PEP EP COMPANY PROFILE

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Head Office | Menara Standard Chartered 21st-29th Floor | Jl. Prof. Dr. Satrio No. 164 | | Jakarta Selatan 12950 | Indonesia |