introduction to oil & gas industry for economic student

By Puput Aryanto Risanto

Presented for Accounting Study ProgramFaculty of Business and Information Technology

University of Technology of Yogyakarta30 April 2015

Oil & Gas in Our LifeHistory of Oil & GasOil & Gas IndustryUpstream Industry Petrole m Licensing S stem Petroleum Licensing SystemOrganization Chart Petroleum Economics Petroleum Economics Typical Oil & Gas CompanyOil & Gas Industry CharacteristicyWhy Working in Oil & Gas About the AuthorQ&A

Energy for : Transportation (Gasoline, Diesel Fuel, Aviation

Fuel, NGV) Power Plant Industry & Household (CNG LPG etc) Industry & Household (CNG, LPG, etc)

Raw Materials for : Plastic & Polymery Basic Chemical Substances Petrochemical Product

Infrastructure : Asphalt

Oil was formed from the remains of Oil was formed from the remains of animals and plants that lived millions of years ago Over the years the remains years ago. Over the years, the remains were covered by layers of mud. Heat and pressure from these layers turned theminto crude oil & gas. The word "petroleum" means "rock oil" or "oil from th th "the earth."

Upstream Midstream Downstream

Upstream : Explore (find new source), Drill, and Produce (lift oil & gas

into surface) into crude oil and/or natural gas forminto surface) into crude oil and/or natural gas form Midstream :

Transport crude oil via pipeline, truck, or crude oil tankerN t l G Li fi ti i t LNG Natural Gas Liquefication into LNG

Transport natural gas via pipeline, truck, or LNG carrier LNG regasificationD t Downstream : Process crude oil in a refinery Process natural gas into chemical products in

petrochemical plantpetrochemical plant Convert heat energy from natural gas into electricity in a

power plant

U t Mid t D tUpstream Midstream Downstream

Exploration Appraisal Development Production Abandonment

Exploration : Find a new oil & gas reservoir

Appraisal : Appraisal : Ensure new finding is commercially feasible

Development :D l f f ili i & il & Develop surface facilities to extract & process oil & gas from the reservoir

Production : Produce oil & gas and maintain the facilities until end of

field life / contract period Abandonment :

Close the production and return the field into original condition

Consession Production Sharing Contract (PSC) Risk Service Contract (RSC)

PSC i h id l d d d fi PSC is the most widely used today and first time introduced by Pertamina.

President

Exploration & Subsurface

Production & Development

Finance & General Support

Exploration

New Block

Subsurface

Well Maintenance

Production

Operation

Development

Project -Greenfield

HSE

OH & S

Finance

Accounting

HR & Support

HR

Existing Block Reservoir Engineering Maintenance Project -

Brownfield Process Safety Tax Public Relation

Environment Cost Control Legal

Commercial

SCM

ITIT

Logistic

40 EXPLORATIONPRODUCTION

30APPRAISAL

10

20

Revenue

DEVELOPMENTABANDONMENT

-10

0

-20

-10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Year

Revenue

Year

Oil & Gas Company A company which have a block to explore /

produce or both

Oil S i C Oil Service Company A company which doesn’t have a block, but

provide materials or service to Oil Company, p p y,consists of : Vendor (provide materials / equipments) Consultant (provide services) Consultant (provide services) Contractor (provide both materials, equipments, and

services)

High RiskHigh RiskHigh Capital Extensive Technology Extensive Technology Long Term Investment

Piper Alpha Incidents, North Sea, 1988. Only 59 survivor from 226 Personnel On Board

PROS Relatively High Compensation Multidiscpline Dynamic Environment

CONS High Risk High Risk Remote Area Working during Holidayg g y

Puput Aryanto Risanto had more than 10 years experience in Oil & Gas industry. During this experience in Oil & Gas industry. During this slides presented, he was working for Petronas Carigali Sdn Bhd at Kuala Lumpur, M l i P i l h k d f P i Malaysia. Previously he worked for Premier Oil at Jakarta and Total E&P Indonesie at Balikpapan, East Kalimantan. His expertisesBalikpapan, East Kalimantan. His expertisesincluded joint venture management, project engineering and management, electrical

i i i d engineering, construction management, and recently deep water development. He can be contacted at aryantorisanto@yahoo comcontacted at aryantorisanto@yahoo.com