EP COMPANY PROFILE
When PT Pertamina EP began its transformation journey in 2006, Indonesia’s
economic situation was remarkably motivating. The year was decorated with
various records of success, yet also painted with numerous challenges that made
us more experienced in managing the company.
At early 2006, the country still experienced a carry-over economic burden from the
previous year due to oil price increase, which in turn resulted in higher prices.
All the while, non-fundamental factors such as geopolitics and market speculation
conspired in soaring global oil price trend. Thus, oil and gas industry has continued
to appear very prospeting and optimistic in nature.
It was within such situation that Pertamina EP sets its transformation pace in motion.
The transformation program was designed to resolve technical problems and
simultaneously answer the socially situational pressures.
With average production growth of 6-7 percent in the past three years, we have
high optimism to continue growing and answering both government and people’s
challenges to escalate our national oil and gas production.
messagefrommanagement
Tri Siwindono(President Director)
forewordPT PERTAMINA EP or PEP is one of the
most prominent oil and gas producers
in Indonesia, will strive to put its best
efforts in undertaking the nation’s duty
to fulfilling the needs of Indonesia’s
community at large.
With endless waves of passionate
enthusiasm, PEP commits
to constantly increase its
exploration and production
undertakings through
proper implementation
of Good Corporate
Governance to
achieve the
desired-end-state,
‘PEP WORLD
CLASS’.
PEP COMPANY PROFILE 02
EP COMPANY PROFILE
visionIn becoming the foremost oil and gas producer, PT PERTAMINA EP (PEP) has split its
visionary aspirations into a three-year strategic planning period, each of which is aiming
to become: ”Respectable Cost Cost-Effective and Efficient Oil & Gas Producer”
(for 2006-2008), ”Number 1 Oil & Gas Producer in Indonesia” (2009-2011) and
”PEP World Class” (2012-2014).
missionWhile reaching the set objective, PEP consistently strives to run the oil and gas business
efficiently, effectively, and within a safe and healthy environment, thus increasing value
for the stakeholders.
corevalues
It has been PEP commitment to constantly foster standard ethical behavior and
to implement professional business ethics throughout internal and external interactions.
Such behavioral sandards, that we call core corporate values, have been perceived
as fundamental as well as strong groundwork of a continuous relationship with
the stakeholders. The values consist of focus, integrity, visionary, excellence,
mutual respect, good corporate governance, optimization, personal quality,
empowerment, peerless shareholder value and proper HSE.
Highly respecting the corporate ethical values throughout our behavior.
04PEP COMPANY PROFILE
EP COMPANY PROFILE
ourmilestone
10 december
1957Establishment
of PT Perusahan Minyak Nasional
(PERMINA).
20 Augus t
1968PERMINA
merged with PERTAMIN into
PERTAMINA.
yea r o f
2001Government
issued Oil and Gas Law No. 22
Year 2001.
17 September
2003The signing of Coorperation
Contract between PT PERTAMINA
(Persero) and BP MIGAS on all
Oil and Gas Mining Authority Zone.
13 September
2005The establishment
of Pertamina EP.
17 September
2005The Signing of
Coorperation Contract that established PERTAMINA EP
working areas
06
Business wise, the voyage of Pertamina EP
is interrelated with its mother company,
PT Pertamina (Persero). In harmony with global
and national oil and gas industry dynamics,
PT Pertamina (Persero) has undergone several
changes in name and status. It started with
the establishment of PERMINA in 1957,
which \turned into PERTAMINA after merging
with PERTAMIN in 1968. In 1971, the government
issued Law No. 8 that positioned PERTAMINA
as state-owned oil and gas company.
As oil and gas environment continues to shift,
the government responded by issuing Oil and
Gas Law No. 22 Year 2001 which altered the
status of PERTAMINA into a State-Owned
Enterprise, which renamed PT Pertamina
(Persero), with separate Directorates for the
upstream and downstream businesses.
The law also urged PT Pertamina (Persero)
to establish separate business subsidiaries
so that the business of exploration, exploitation
and production of oil and gas become
more managable.
It was on such ground that Pertamina EP was
established on 13 September 2005. Then on
17 September 2005 PT Pertamina (Persero)
signed a Production Sharing Contract (PSC)
with BPMIGAS, governing all oil and gas mining
areas accordingly. Eventually, majority of those
areas became Pertamina EP’s working areas,
including those previously managed by
PT Pertamina (Persero) through Technical
Assistance Contract (TAC) and Joint
Operating Body Enhanced Oil Recovery
(JOB EOR).
PEP COMPANY PROFILE
EP COMPANY PROFILE
businessfocusPEP strives to transcend maximum efforts and synergy throughout all levels of the organizationin order to achieve excellent outcomeat the end of the day.
PT Pertamina EP (PEP) is an operating subsidiary
business unit that focuses on managing the
upstream oil and gas production through a
more manageable exploration and exploitation
activities. Adding to that, PEP has been
undertaking other supporting businesses, which
have been intended to back up the main business
directly or indirectly.
Soon after its establishment on 13 September
2005, PEP has been dedicating to undergo
its core business with strong commitment,
to work hard and be productive, have motivated
PEP in elevating Indonesia’s position as a net
oil importer. Consequently, PEP has strived to
constantly increase the oil and gas production
capacity, to which its daily capacity of production
indicate
120 thousand
of barrels oil per day (BOPD)
and 1,000 million standard cubic
feet per day (MMSCFD) of gas.
Supported with the above capacity of oil
production, PEP feels confident to reach
the raw oil production targeted by the
government for export. Meanwhile,
PEP’s gas production is fully produced
to support domestic industry needs, as part
of PEP’s contribution to add to Indonesia’s
competitive advantages within the industry.
08
corebusiness
PEP COMPANY PROFILE
EP COMPANY PROFILE
year 2005 year 2006 year 2007 year 2008
oil
legend:
gas
1030
900 98
0
785
1100
870
1120
1007
0
200
400
600
800
1000
1200
In accordance with the Technical Assistance
Contract (TAC) and Joint Operating Body
Enhanced Oil Recovery (JOB EOR), PEP’s
working areas, respectively; all stretched
from Sabang to Merauke as marked on the
following operation map:
The following illustrates PEP’s production of oil and gas:
The following illustrates PEP’s top 10 oil and gas producer:
0 500 1000 1500 2000 2500 3000
2554.32 Total
Pertamina
ConocoPhillips Ltd.
ExxonMobil Oil Indonesia
Vico
PetroChina Int. Ind. Ltd.
Chevron Indonesia Company
CNOOC (SE) B.V.
Premier Oil
Medco E & P Indonesia
1070.77
1031.99
747.88
494.06
287.24
285.99
Top 10 Gas Producer
170.61
150.91
123.53
Top 10 Oil Producer
0 100 200 300 400 500
490.879 Chevron Pacific Indonesia
Pertamina + JOB + TAC
ConocoPhillips Ltd.
Total
PetroChina Int. Ind. Ltd.
CNOOC (SES) B.V.
Medco E & P Indonesia
Chevron Indonesia Company
BOB Bumi Siak Pusako Pertamina Hulu
BP Indonesia
118.91
83.119
76.854
48.441
45.673
41.898
38.863
28.941
23.627
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EP COMPANY PROFILE
NORTHERN SUMATRA
BLOCK LIRIK
BLOCK JAMBI
EASTERN JAVA
WESTERN JAVA
BLOCK TARAKAN BUNYU
BLOCK MATINDOK
BLOCK SORONG
BLOCK TIMOFORO
BLOCK KAMUNDAN & WIRIAGAR
BLOCK SANGATTA
BLOCK SANGA SANGA
BLOCK TANJUNG
BLOCK UDANG
CENTRAL SUMATRA
SOUTHERN SUMATRA
10
At this stage, PEP owns four main
backbone fields for their high
production capacity.
As a consequence, any impacts
resulted from those fields will
eventually affect the whole PEP
production. The four working
fields are Tambun, Limau,
Sukowati and Poleng.
Capacity wise, total production
of Tambun field is 14,000 BOPD,
Limau field is 8,000 BOPD;
Sukowati field is 19,000 BOPD,
and Poleng field is 8,500 BOPD.
In total, all the four main fields
contribute 49,500 BOPD or
40 percent of the targeted
125,000 BOPD.
PEP COMPANY PROFILE
Lirik
Jambi
Limau
Benakat
Tanjung
Sangasanga & Tarakan
01
02
03
04
05
06
UBEP
Perlak
NAD Area
West Sakakemang
East Sakakemang
Kluang Siarak Area
Suban
Southern Sumatera Area
Udang
01
02
03
04
05
06
07
08
SUMATRA
Sanga-sanga
Sangatta
Bunyu
Matindok
Sele
Klamono
Timoforo Area
Wiriagar
Kemundan
01
02
03
04
05
06
07
08
09
EASTERN INDONESIA
Lapisan L. Parigi
X-Ray
Jabati Area
Western Java
01
02
03
04
JAVA
EP COMPANY PROFILE
Today, PEP is the second biggest oil and gas
producer in Indonesia, with its total oil and
gas production has reached 400,000 barrel oil
equivalent per day (MBOEPD).
While on the reserve side, PEP holds
the largest oil and gas reserve in
Indonesia, totaling at 6,171
MMBOE, also the third
largest in Asia Pacific.
PEP aims to be the number one oil and gas producer in Indonesia in 2011, by optimizing its largest oil and gas reserve.
marketposition
Various strategic
programs have been
developed to support the
company’s growth. One of those
is 7 Focus Point, which has been
strategically implemented since 2008.
Firstly is to focus on securing production of
the main fields, considered as the backbone of
all PEP production activities. Next is to focus on
optimalization of production by way of improving
infrastructure and supporting facilities of the
existing fields, aiming at enhancing production
level of those fields.
strategy
The third focus is to reactivate old wells on the
production fields, while reactivation of old fields
comes as the fourth focus. The reactivation
initiatives seem potentially promising to adapt
while adjusting with the fluctuative increase
of the oil price.
Focusing on extracting and filtering of condensate
gas transmission pipes, intensifying Enhanced
Oil Recovery (EOR), and Put on Production (POP)
for exploration wells come as the fifth, sixth and
seventh focus, respectively.
Another strategic program includes acquisition
of 3D seismic data that aims to obtain a more
accurate 3D seismic data needed for the
development of production field and EOR
application; all 3D seismic programs have
located ± 2,700 km2 areas.
Meanwhile, other strategic programs include:
accelaration of KSO cooperation; speeding up
unitization; resource intensification, accelerating
resource verification; and other daily operational-
related initiatives.
PEP is the only one amongst five major Cooperation Contractors who is confident to attain 2008 oil and gas production target set by the government.
EP COMPANY PROFILE 14
transformation phase, namely Talent Management
and Succession Planning.
Talent Management is a founding guidance for
potential employees or those with extra skills
to be developed as the company’s key players.
This guidance is a tool for company leaders in
developing and selecting officials to take up
key positions. Since it is based on meritocracy
therefore all employees have equal
opportunities for self-development.
Succession Planning, is a tool for planning,
preparing of employees’ career path and
development, as well as cadre monitoring
and evaluation. Cadre development has
begun since entry level and will be monitored
on a constant basis.
Therefore, rigorous, sustainable, and comprehensive programs aimed at developing professionalism among our employees, have been continuously implemented throughout our growth.
corporatestrengthsProduction has reached 80% of the ultimate primary recovery level and the estimated oil reserves totaling at 5 billion barrels of oil (BBO).
Employees of Pertamina EP (PEP) are
professionals who are selected through a
strict and accurate process. In addition, their
capabilities are continuously enhanced to shape
them into enthusiastic people who posses a
lasting and competitive uniqueness, professional
interpreneurship spirit and of high moral.
These moralities are essential since PEP
workers are fighters/warriors who persistently
ourpeople
relied upon as the country’s revenue generator.
That’s the reason why human resource
(HR) improvement has become
a constant necessity.
HR development of PEP emphasizes on increasing
personal quality and empowerment by meeting
the World Class People standards. Our journey
to build world class employees began with
some initial projects carried out during early
PEP COMPANY PROFILE
EP COMPANY PROFILE
To manage its oil and gas working areas,
PEP conducts own operation and partnership
cooperation in form of Joint Operating Body
Enhanced Oil Recovey (JOB EOR) and Technical
Assistance Contract (TAC).
operations
Throughout its operations as a subsidiary of PT PERTAMINA (PERSERO), PEP total oil production has contibuted majorly to the national’s oil reserve.
differentiation
With 140,000 km2 of working area, PEP is a
Contractor of Cooperation Contract operating
on the most widespread area in Indonesia.
This also means that PEP owns 20 percent
shares of national oil reserve and 10 percent
of national gas reserve. These potentials will
eventually turn Pertamina into the largest oil
and gas producer in Indonesia.
Meanwhile, production is projected to increase
to 684 MBOEPD in year 2014, double from the
2007 production of 350 MBOEPD.
Pertamina EP divides its working areas into three
regions, Sumatera, Java and Eastern Indonesia
Region. The head office manages the entire
JOB EOR and TAC operations, while each
region manages their own operation.
The operation of three regions is divided into
12 Field Areas namely Rantau, Pangkalan Susu,
Lirik, Jambi, Prabumulih and Pendopo
in Sumatera Region, Subang, Jatibarang and
Cepu in Java Region and Sangatta, Bunyu
and Papua in Eastern Indonesia Region.
Beside managing the previously mentioned
working areas, PEP also manages its working
areas through projects, namely gas development
project of Pagar Dewa in Sumatera, Gundih in
Central Java and Matindok in Sulawesi.
EP COMPANY PROFILE
corporatecommitmentPEP is committed to striving for the best in all its business activities, including HSE performance.
Proper implementation of Good Corporate
Governance (GCG) aims to strengthen corporate
image as well as performance, while maximizing
the shareholder’s values at the same time. Within
PEP, GCG implementation has five aims.
goodcorporategovernance
Firstly, it aims to maximize the corporate values
by aggressively applying the principles of
transparency, independency, accountability,
integrity and adequacy throughout all corporate
conducts. Ensuring a professional and
independent corporate management practices
comes as the second aim. The third is developing
a specific decision making system by all
Business Units based on high ethical codes
and strict compliance to the set regulations and
business codes. Realizing the Corporate Social
Responsibility program to the stakeholders and
escalating a conducive national investment
climate, particularly in energy and petrochemical
areas are the fourth and fifth aim.
Throughout all conducts, PEP holds Good
Corporate Governance principles such as
Transparency, which is open and honest in all
decision making process, while assuring that
any financial related information is relevant and
accurate. Principle of Independency states
that employees must avoid situations which
could cause conflicts and pressures, internally
or externally, that are not in accordance with
prevailing rules and regulations, as well as
healthy corporation principles.
Clarity in describing each business unit’s
functions, duties and responsibilities in order
to manage the company more effectively
is principle of Accountability that PEP holds
strongly. Principle of Responsibility implies
appropriateness of company’s management
practices to prevailing rules, in a way that
also complies with healthy corporation
principles. And lastly, principle of Fairness
understood as being fair and equal treatment
in meeting the stakeholders’ rights as
the stated by the prescribed rules
and regulations.
We believe that proper good governance implementation is the foundation of our movement, with the spirit of integrity and rightness, to being the foremost national oil and gas producer of a world-class state of mind.
18PEP COMPANY PROFILE
EP COMPANY PROFILE 20
Moreover, preserving the green nature of the surrounding environment has also been our main endeavor in creating a healthy and clear atmosphere.
healthsafetyenvironment
At PERTAMINA EP (PEP), Health, Safety,
and Environment (HSE) initiatives have been
undertaken to ensure adequate management
performance and practices. HSE practices ensure
that risks to both people and the environment
are addressed, as well as enhancing social
growth of the surrounding community.
Going world class, PEP realizes that HSE
implementation is inseparable from all business
aspects. In due course, PEP strives to sustainably
improve its understanding of the HSE culture,
so that the HSE initiative can be merged into
the primary corporate culture through integrated
HSE Management System that is integral and
will synchronize all business operations.
More importantly, the system will bring about a
more safe, excellent, efficient and environmental
concern operations.
A set of HSE Management System emphasizes
on 13 major elements has been made effective
by PEP to affirm that it is the duty and
responsibility of everyone in the company.
Therefore, proper HSE implementation
throughout all layers is a compulsory action
for PEP to reach ‘HSE Operating Excellence’.
The 13 elements include ideal leadership and
integrity; awareness, training, competency;
partnership management, design, construction
and commissioning; operation and after operation
management; inspection and maintenance;
security management (materials and products);
management of change; communication; crisis
and emergency handling; incident investigation;
documentation; and evaluation and audit.
PEP commits to bring about respectable HSE
practices in accordance to the applied regulations
and HSE standards. The objective is to minimize
incidents, actively anticipate the negative impact
resulted, and improve the company’s image.
However, proper implementation of HSE
Management System throughout PEP and
partners’ operations is one of the developed
five strategies. Other strategies include special
HSE workshop for workers, making HSE
practices inseparable from the corporate culture,
integration of the required technology with PEP’s
operations, and strengthening the corporate
image throughout all aspects of HSE.
PEP COMPANY PROFILE
EP COMPANY PROFILE
Intense interactions with the local people and regular community development initiatives have initially been PEP’s moral obligation ever since our early establishment. PEP realizes that the support and involvement of the local community play an important role throughout our business sustainability and hence our growth.
As part of the community, PT PERTAMINA
EP (PEP) is committed to actively express
its social responsibility and to create an
environmental friendly operations. Likewise,
PEP believes that positive social perception
is good for business, providing a secure,
inspiring and dynamic atmosphere.
Realizing its responsibility to the community,
PEP knows that community development
is a moral obligation, a way of showing
concern and earning trust.
Hence, PEP feels
obliged to share
its economic, social, and cultural
perspectives through Corporate Social
Responsibility (CSR) program. Besides,
PEP also considers the CSR program
as part of its business investment
initiatives for growth, ensuring
future business.
It is PEP commitment to empower the
local community and protect the areas
of its operations to develop a conducive
community relationship and to take
responsive action in handling after-mining
impact. As a result, the CSR activities
are realized through a number of programs
focusing on religious, health, education
and economy related issues.
corporatesocialresponsibility
24PEP COMPANY PROFILE