Publications

Indonesia’s positive contribution to reduce greenhouse gas emissions is expected to reach the world’s net zero emission target. In the upstream sector, one such effort is to utilize carbon capture utilization and storage (CCS/CCUS). To support the implementation, a Minister of Energy and Mineral Resources regulation on Implementation of Carbon Capture and Storage, and Carbon Capture, Utilization and Storage was developed and was issued on March 3rd, 2023 (MR 2/2023). Domestic and international stakeholders have been involved in the development process. MR 2/2023 focuses on CCS/CCUS in the upstream Working Area, emphasizing standard-compliant technical aspects and good technical rules while paying attention to site-specific characteristics, while at the same time opening monetization opportunities from such activities with the potential to become new income for the Government of Indonesia as well as the Contractor and to improve project economics. Nowadays, there are fifteen (15) CCS/CCUS projects in Indonesia under various stages of study, and all are expected to be onstream before 2030. CCS/CCUS is one of the climate change mitigation activities in the oil and gas upstream sector while CCUS also potentially improves oil and gas production, in which greenhouse gas is injected into partially depleted reservoir to assists in pushing/sweeping hydrocarbon to the surface. By opening the opportunity for a third party to transport and inject greenhouse gas arising out of its business activities to the upstream oil and gas work area, CCS/CCUS can give a greater benefit and have a positive impact on climate change mitigation activities not only to the upstream oil and gas sector but also to other sectors outside of upstream oil and gas. Such inter-sector coordination and collaboration supports the Government’s efforts to reach the national net zero emissions target in 2060. In line with the increasing awareness to reduce greenhouse gas emissions in everyday operations, it has pushed many international companies to consider making investments in countries with climate change mitigation policies in place, even taking it further in considering it as a license to invest. Countries with strong support to climate change mitigation policies rank higher as a place in which to invest. The upstream oil and gas sector is very supportive of the issuance of regulations on climate change mitigation, including those on CCS/CCUS. It is understandable to have close cooperation in making a uniform perception among stakeholders coming from diverse backgrounds, as long as it is understood that the result of greenhouse gas emissions reduction activities should benefit not only the Government and businesses but also communities affected by climate change, and it is expected that an agreement benefiting everyone can be reached.