Pursuing Energy Transition Target, Pertamina Ensures Investor Support
Jakarta, June 29, 2021 – Anticipating changes in the global energy megatrend, PT Pertamina (Persero) continues to pursue an implementation plan for the energy transition. Therefore, it runs according to schedule. One of the efforts made is to ensure positive support from investors.
At the Pertamina Investor Day 2021 event, the Director of Strategy, Portfolio, and Business Development of Pertamina, Iman Rachman, explained that the world is currently facing a significant demand disruption, both short term due to COVID-19 and long-term. In the future, global fossil energy demand is predicted to grow and reach its peak in 2030 before declining with the growth of New and Renewable Energy (NRE).
As for Indonesia, energy demand is projected to recover after COVID-19 in 2022 and grow by around 2.1% per year until 2040.
Nationally, the energy mix will support emission reductions with a target of 29% in 2030 while still meeting the national energy needs of 7 million Tera Joules.
"Currently, we are in the process of moving towards an energy transition. For this reason, Pertamina's energy portfolio will be aligned with the energy mix targets set out in the 2025 National Energy grand strategy. Most of the energy supplied is still fossil fuels, but the growth of NRE will be more aggressive," said Iman.
Pertamina's energy mix target is to reduce the portion of the use of fuel and LPG to 64% and increase gas use to 19% and renewable energy to 17% of the total energy mix in 2030.
To achieve the energy mix target, said Iman, Pertamina will build an integrated oil and gas supply chain and actively build an NRE portfolio by utilizing domestic resources.
"With this strategy, by 2030, Pertamina will supply around 71% of Indonesia's total energy needs," he added.
As an energy SOE mandated to maintain national energy security and independence, Pertamina continues to increase oil and gas production. It is by optimizing existing fields and high-value potential fields (Crown Jewels) by implementing EOR through partnerships and digitalized operations implementation. It is also by accelerating development assets and exploration and selectively encourage other initiative programs.
Pertamina also continues several strategic projects, such as the Refinery & Development Masterplan and increasing geothermal capacity to 1,128 MW in 2026. It also includes Grass Root Refinery, Petrochemical, and building a Green Refinery with a capacity of 6 - 100 KTPA and also Ethanol in 50 MT per year in 2025. Pertamina is also involved in Battery Company to produce 140 GWh batteries by 2029 and develop an EV battery ecosystem including swapping & charging business.
According to Iman, Pertamina has also implemented adaptation to the energy transition by building new gas transmission and distribution and building a methanol plant for gasification with a capacity of 1,000 KTPA in 2025.
Other energy transition initiatives carried out by Pertamina include revitalizing business plans related to city gas for 30 million households, developing LNG business and trading, and increasing the portfolio in the electricity sector through gas, geothermal, and solar power plants.
With this business initiative, Pertamina will allocate around 9% of its CAPEX for the 2020-2024 period for the development of NRE. This value is higher than other international energy companies' NRE investment, only 4.3% on average.
Several Pertamina projects are National Strategic Projects carried out during 2020-2024, both in the upstream, downstream, and renewable energy sectors. It has the potential to be collaborated and strengthen the foundation of the National economy.
"Other partnership opportunities can also be carried out in Pertamina's strategic projects and plans for unlocking values to optimize the value of Pertamina Group," said Iman.**