East Kalimantan Environmentally Sustainable Development Strategy

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78 Exhibit 51 Three GDP improvement initiatives could reverse the decline to lift 2030 real GDP to IDR 64.25 trillion Exhibit 52 Real GDP IDR Trillion; Constant Price 2000 65 60 55 50 45 40 35 30 25 20 15 10 5 0 2008 10 SOURCE: BPS; Global Insights; Team analysis 20 DRAFT Oil (mmbbl) 30 3 2a 1 Additional downstream facilities CBM stream to Bontang 2b LNG plant CBM production Accelerated exploration LNG BAU Refinery BAU Upstream oil & gas BAU East Kalimantan’s oil & gas resources have been largely exploited but there remains some potential for exploration, particularly in gas Kutei basin Tarakan basin Kutei basin Produced Technical (currently undevelopable): 172 Produced Remaining 2,820 474 587 6 118 Remaining 23,474 20,663 F95: 1,386 F50: 4,790 F5: 10,067 F95: 18,269 F50: 59,763 Yet-to-find N/A Yet-to-find Gas (bcf) Technical (currently undevelopable): 5,371 F5: 127,895 Produced: 155 Tarakan basin Remaining: 15 Technical: 1044 N/A SOURCE: WoodMackenzie, USGS, team analysis
79 granted in 2008–2009 and contain 12.7 tscf. Assuming continued auctions of CBM blocks 21 to 2030 (but at a more conservative pace and size) that would cover at least 60 percent of current resources, East Kalimantan could produce an additional 2,500 mmcfd of CBM gas production by 2030. This new stream of coal-bed methane would double business-as-usual gas production by 2030 from 2,200 mmcfd to 4,700 mmcfd. Furthermore, this new supply of gas from CBM could be used to raise LNG production at Bontang LNG plant to its historical utilization rate of 92 percent, despite the declining conventional gas feed. There should be ample markets for the additional LNG from Bontang, from the existing buyers in South Korea, Japan, and Taiwan as new markets such as China. East Kalimantan has CBM resources of 109 TSCF, almost a quarter of Indonesia’s CBM potential 1 2 3 4 5 6 7 8 9 10 11 Kutai Basin S. Sumatra Barito C. Sumatra N. Tarakan Berau Ombilin Pasir/ Asem NW Java Sulawesi Bengkulu TOTAL Target Formation M.Enim Warukin Prangat Petani Tabul Latih Sawaht Warukin T.Akar Toraja Lemau Completeable Coal Thickness (m) 24 24 15 6 6 12 0.45 0.45 0.80 0.45 0.70 0.55 0.40 DRAFT SOURCE: SPE: Stevens, S. "Indonesia Coalbed Methane Indicators and Basin Evaluation" 37 28 21 15 15 Coal Rank (R0%) 0.47 0.45 0.50 0.40 Avg Depth (m) 385 100 500 772 30,248 3.0 0.8 2.0 3.6 453.3 Building additional downstream gas processing facilities would result in a GDP increase of IDR 3.6 trillion by 2030. Coal-bed methane should be fed to the Bontang LNG plant and PT Pupuk Kaltim fertilizer plant until the gas feed exceeds the maximum capacity of these plants. By 2017, the CBM gas feed would reach the maximum capacity of the Bontang LNG plant: 3.7 billion standard cubic feet per day (bscfd). By 2023, the excess CBM supply would reach 1.0 bscfd, enough to operate two additional LNG liquefaction and purification facilities (called LNG trains) and by 2030, three additional LNG trains. Building a new LNG train requires large capital investment and can require up to five years to complete; thus investors are typically reluctant unless they can be assured of sufficient long-term supplies. The decision whether to expand LNG trains based on CBM supplies would be made in the future and depend on the regulatory framework at the time, LNG prices, domestic demand, and certainty over supply. It may be easier to find investment for capital-intensive downstream facilities such as fertilizer and petrochemical complexes that use 762 915 915 762 701 671 762 701 1524 610 610 High Graded Area (km2) 7,350 6,330 6,100 5,150 2,734 780 47 CBM Complet Able (Tcf) 183.0 101.6 80.4 52.5 17.5 8.4 0.5 Located in East Kal 109 tcf in East Kalimantan (24% of national resources) Exhibit 53 21 The four exploration blocks are Kutai West (5.1 tscf, explored by Newton Energy, Ephindo, and CBM Asia), Sanga-Sanga (4.0 tscf, explored by Vico, BP, and ENI), Kutai-Ephindo (3.1 tscf, explored by Ephindo), and Sanggata West (0.5 tscf, explored by Pertamina, Arrow, and Ephindo)
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East Kalimantan Environmentally Sus
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3 East Kalimantan Environmentally S
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5 Contents Preface 7 Acknowledgemen
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7 Preface A broad global consensus
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9 Acknowledgements The DNPI and the
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11 Executive summary East Kalimanta
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13 1. The development of coal-bed m
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DRAFT 15
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17 Kaltim Green Program The Governm
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19 1. The context for East Kalimant
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21 This resource development pathwa
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23 Both Berau and Malinau are large
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25 In the BAU scenario, CO 2 e emis
Page 27 and 28: 27 TOP 5 ABATEMENT INITIATIVES Top
Page 29 and 30: 29 Kalimantan’s shift to a climat
Page 31 and 32: 31 The sector’s 57 MtCO2e of net
Page 33 and 34: 33 Outside of the sector’s need f
Page 35 and 36: 35 The greatest expansion is expect
Page 37 and 38: 37 improving water management in on
Page 39 and 40: 39 Including financial transfers fo
Page 41 and 42: 41 after the identified abatement m
Page 43 and 44: 43 The Case of Oil Palm Permits and
Page 45 and 46: 45 Emissions from the forestry sect
Page 47 and 48: 47 across Kalimantan in 1997 and 19
Page 49 and 50: 49 Utilizing concession buyout sche
Page 51 and 52: 51 Pilot Projects Pilot projects ha
Page 53 and 54: 53 GDP Potential The economic decli
Page 55 and 56: 55 Downstream manufacturing would i
Page 57 and 58: 57 downstream manufacturing as it w
Page 59 and 60: 59 Swidden agricultural practiced b
Page 61 and 62: 61 Although East Kalimantan has far
Page 63 and 64: 63 Reaching average national yields
Page 65 and 66: 65 farmers . We have identified sev
Page 67 and 68: 67 Many mining operations are locat
Page 69 and 70: 69 Unlike timber or oil palm planta
Page 71 and 72: 71 exploration and production conce
Page 73 and 74: 73 The Economic Opportunity of Post
Page 75 and 76: 75 Entering downstream value chain
Page 77: 77 Current Context The oil and gas
Page 81 and 82: 81 Emission from flaring is declini
Page 83 and 84: 83 Satellite images can help monito
Page 85 and 86: 85 Under business as usual, relativ
Page 87 and 88: 87 BERAU Berau is the third largest
Page 89 and 90: 89 350,000 ha of Kutai Timur is cat
Page 91 and 92: 91 substantial natural resource ext
Page 93 and 94: 93 Borneo conservation area as well
Page 95 and 96: 95 agricultural processing. As Pena
Page 97 and 98: 97 Range of climate related risks t
Page 99 and 100: 99 predict increased precipitation
Page 101 and 102: 101 In addition to the refinery and
Page 103 and 104: 103 The greatest economic risks fro
Page 105 and 106: 105 change issues. In December 2009
Page 107 and 108: 107 Proposed BFCP governance and ma
Page 109 and 110: 109 the lack of a strong system, th
Page 111 and 112: 111 Carbon Accounting, Standards, a
Page 113 and 114: 113 EXAMPLE INITIATIVES REQUIRING C
Page 115 and 116: 115 for example, includes represent
Page 117 and 118: DRAFT 117
Page 119 and 120: 119 Sources • 2010, Kesiapan Kali
Page 121 and 122: 121 • Badan Perijinan Dan Penanam
Page 123 and 124: 123 • Daniel Murdiyarso et al, Me
Page 125 and 126: 125 • Marcus Colchester et al, Pr
Page 127 and 128: 127 • Yosep Ruslim et al, STUDY O
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East Kalimantan Environmentally Sustainable Development Strategy

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