Indonesia – Malaysia’s state energy firm, Petronas, announced plans for an “aggressive” expansion in Indonesia, aiming to establish an operational hub in East Java and invest in exploration across the country’s remote eastern regions, according to the company’s Indonesia head.
Yuzaini Md Yusof, Petronas’s head in Indonesia, stated that recent regulatory reforms facilitating energy project development have encouraged the company’s expansion efforts, Reuters reported.
Petronas currently operates four oil and gas blocks in Indonesia, three of which are in East Java in the western part of the archipelago, and holds participating interests in several additional projects.
Yusof also reportedly noted that they aim to establish a hub in East Java by connecting production sites and integrating logistics facilities for its three operations in the region.
“Our first strategy is to grow bigger in the East Java area. And the next long term plan is for us to expand our business portfolio in eastern Indonesia,” Yusof told Reuters.
East Java stands to benefit from a pipeline project set for completion in December 2025, which will connect supply from the island’s eastern region to demand centres in the densely populated west. Petronas is eager to expand its operations in alignment with this development.
In the meantime, Petronas is still in the exploration phase of its North Ketapang block, and it anticipates first oil production from the Hidayah field in the North Madura II block by 2027. Additionally, the company is developing a new gas field within the Ketapang block.
“With that connection of this infrastructure project, it has created attractiveness for the operators and companies that are working in the East Java area,” Yusof said.
Petronas’ expansion plans follow the recent inauguration of President Prabowo Subianto’s administration, which has pledged to strengthen energy development in Indonesia to reverse a decades-long decline in production by the former OPEC member.
In eastern Indonesia, Petronas holds a 15% stake in the Masela gas project and, earlier this year, signed a production-sharing contract for the Bobara block off the coast of West Papua, according to Reuters.
The Bobara block, estimated by the government to contain 6.8 billion barrels of oil equivalent, will mark Petronas’s first deep-water project in Indonesia as an operator. Yusof also reportedly said that Petronas is exploring the possibility of bringing in a partner for the project.
“These two block acquisitions reaffirm our commitment to unlocking the potential in the eastern Indonesia area, where most of that area is frontier, which is very high risk and not many operators have gone through,” Yusof explained to Reuters.
