ADAPTIVE SCENARIO PLANNING DEVELOPMENT FOR INDONESIAN UPSTREAM OIL AND GAS INDUSTRY CASE STUDY OF PT KM IN MANAGING MATURE FIELD PHASE

• Main Author: Hermawan Sridjaya, Rolly
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/74454
• Institution: Institut Teknologi Bandung

The global economic conditions after the COVID pandemic, which have not fully recovered, the vulnerability of global oil prices due to unpredictable external factors, global pressure for decarbonization efforts and the fulfillment of ESG parameters to support energy transition, the less competitive condition of oil and gas reserves in Indonesia, and the contract schemes and fiscal incentives in Indonesia that are considered unattractive by investors are part of the tip of the iceberg of uncertainty in the external conditions of the upstream oil and gas industry in Indonesia. This uncertainty directly and indirectly impacts the stakeholders in the upstream oil and gas industry, particularly from the perspective of oil and gas contractors, including PT Kelola Migas (PT KM). PT KM is a state-owned enterprise involved in the upstream oil and gas industry, assigned as the owner and sole operator of "Block X," with gas as the primary production, which is currently entering the maturity field phase with an inevitable natural decline. This challenge is also faced and internally mitigated by PT KM. In relation to the above conditions, PT KM requires a comprehensive strategy formulation process based on a long-term understanding of potential future scenarios that focus on external factors as uncontrollable factors that will significantly impact the company. This research is conducted with a focus on the use of adaptive scenario planning methodology, which will provide a fresh perspective for PT KM in utilizing strategic tools oriented towards the medium and long term. From this research, two primary external driving factors were identified, which have the greatest impact and uncertainty: "Government Policies and Regulations" and "World Geopolitical Tensions." These two factors are used as a framework for scenario matrix development and formulating three scenario narratives of what may happen in Indonesia's upstream oil and gas industry over the next 10 years. The three scenarios are "Hiding to Nothing," "Peek-a-boo," and "What You See is What You Get." Exploring the implications and options for each scenario is conducted to provide strategic choices for PT KM in facing potential situations. The identification of early warning signals for each scenario is also carried out as indicators of changes in the current situation towards one scenario or another. In conclusion, a combination of strategies from "Base Strategic Imperatives" and "Adaptive Strategic Imperatives" tailored to each scenario will ensure the business continuity of PT KM until the end of the contract period.