Publications

Indonesia is at an energy crossroads. While traditional carbon-intensive fossil fuel energy sources ensure energy security, Indonesia is simultaneously committed to reducing up to 41% of emissions by 2030 (Directorate General of Climate Change of the Ministry of Environment and Forestry, 2021). Such ambitious targets can only be met by investments in renewables and carbon capture, utilisation and storage (CCS/CCUS) projects. But must those two worlds of energy – the old and the new – conflict?

First coined at Wood Mackenzie, the concept of an “energy super basin” is one where significant hydrocarbon resources are co-located with plentiful clean or green electricity and CCS/CCUS potential. As the world changes, the basins without these attributes are more likely to become strategically disadvantaged. This means it will be harder attracting capital and investment, as companies look for “greener” assets elsewhere. If Indonesia can cultivate basins with these attributes, they will provide much more sustainable and resilient energy, benefiting operators, consumers and the government.

This paper will focus on where key Indonesian basins sit on this scale. We will rank them from the most advantaged to the most disadvantaged and identify those with the most viable renewables and CCS/CCUS potential. We will factor in remaining hydrocarbon resource potential, carbon sources and sinks, emissions intensity, the potential for renewable integration and cost of operations.

We will also analyse smaller basins with fewer hydrocarbon resources that may have their own ‘niche’ advantages.

By knowing the relative distribution and characteristics of ‘super basins’, decision-makers can optimise resource allocation for targeted developments that can act as hubs to power regional markets.

Making Indonesia’s upstream sector secure, resilient, and sustainable is a huge challenge and will require ambitious, innovative basin-level thinking. It requires close cooperation between the government and private sector, with robust policy and fiscal incentives, new technology applications and the willingness to explore new ideas.