Indonesia 2016 licensing round launch Report

Insight 08 August 2016

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Report summary

Indonesia is offering 14 blocks in its latest 2016 licensing round, through the Regular Tender & Direct Proposal scheme. The authorities are looking to attract further exploration interest through the new 'open bid' system, where bidders are free to bid on work commitments, signature bonus and profit share split, deemed economical for the offered blocks. Investors will be able to vary their bid based on their company's short-term and long-term financial commitments and the economic viability of the block, in the case of any discoveries. In the current environment, companies are unlikely to offer large short-term financial commitments, but may try to bid competitively on the work commitments and profit split. Despite the positive introduction of greater fiscal flexibility, non-fiscal commercialisation challenges remain major barriers to development in Indonesia. The majority of the offered blocks are far from any existing oil and gas infrastructure or gas markets.

Biddable profit split introduced to revive investor interest
- Criteria for success
Acreage on offer
Terms and conditions
- Timeline
- Data
- Evaluation process
Prospectivity analysis
- Deepwater Kutei
- Bintuni
- Other blocks
Economic analysis
- Fiscal regime
- Frontier gas faces monetisation risk
- Round expectations
Appendix
- Development assumptions
- Price assumptions