Indonesia Cabotage Rule May Disrupt Offshore Oil Production

Indonesia’s offshore oil and gas output may drop as production and shipment of the fuels using foreign-owned vessels will be banned under the cabotage rule starting May 7, the nation’s oil and gas regulator said. 

Offshore oil output may drop by 156,020 barrels a day and gas output may fall by 2,549 million standard cubic feet a day, R. Priyono, chairman at the regulator, BPMigas, said during a parliament hearing in Jakarta today. 

Gas output at PT Total EP Indonesia, ConocoPhillips Indonesia and PT Energi Mega Persada may be affected, Priyono said. 

The government proposed revising the cabotage rule to exempt foreign vessels in the oil and gas industry until their contracts expire, Priyono said.Source: Reuters