RECENT DEVELOPMENTS AFFECTING THE ROLE OF PETROLEUM IN THE INDONESIAN ECONOMY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP71T00730R000500040003-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 52
• Document Creation Date: December 21, 2016
• Sequence Number: 3
• Content Type: REPORT

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ERA Project 25.1.157
RECENT DEVELOPM ENTS AFFECTING THE ROLE
OF PETROLEUM IN THE INDONESIAN ECONOMY
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Page
Summary and Conclusions .............................................. 1
I. Introduction... ................................................ 5
II. The Petroleum Industry ........................................... 6
1. Background and Development ................................... 6
2. Current Status (1963) ........................................ 14
III. Significance of Indonesian Petroleum in the World Situation...... 17
1. General ..................... .. 17
2. Significance to Indonesia... ........................... 18
3. Significance to Importing Countries of the Free World........ 21
4. Significance to Communist Countries .......................... 24
IV. Problems and Prospects ............................................ 27
Appendixes
Appendix A. The Indonesian Petroleum Industry, 1958-63.............. 31
1. Indonesia: Production, Consumption, Imports, and Exports
of Petroleum, 1958-63 .......................................... 15
2. Indonesia: Valueof Exports,-1958-62 ......................... 19
3. Indonesia: Production of Crude Oil, 1958-63 ................. 39
CONTENTS
Tables
4. Indonesia: Primary Refining Facilities as of 1 January 1964. 40
5. Indonesia: Secondary Refining Facilities as of 1 January
1964 ......................................................... 41
6. Indonesia: Output of Petroleum Products, 1962 ............... 42
7. Indonesia: Consumption of Petroleum Products, 1960-62........ 43
8. Indonesia: Principal Pipelines, 1963 ........................ 44
9. Indonesia: Bulk Storage Facilities for Petroleum, 1963...... 46
10. Indonesia: Exports of Crude 011, 1960-62 .................... 47
11. Indonesia: Exports of Petroleum Products, 1962 .............. 48
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RECENT DEVELOPMENTS AFFECTING THE
ROLE OF PETROLEUM IN THE INDONESIAN ECONOMY*
Summary and Conclusions
Petroleum is one of Indonesia's major natural resources and, after
rubber, it is the country's second most important export commodity. Net
foreign exchange earnings accruing to the Indonesian government from the
operations of the petroleum industry averaged about US $80 million* annually
in 1962 and 1963- Production of crude oil..in Indonesia in 1963 amounted
to 445,000 barrels per day (bpd) -- about 2 percent of total production
in the Free World and more than 75 percent of production of crude oil in
Asia and the Far East. This amount was adequate to meet most of Indonesia's
estimated. domestic demand*-x-k for about 80,000 bpd of petroleum products,
and to provide exports of 257,000 bpd of crude oil and 108,000 bpd of
petroleum products. Except for lubricating oils, Indonesian refineries,
with a total capacity of almost 280,000 bpd,, can produce a full line of
petroleum products including aircraft fuels. Imbalances in the refinery
yield with respect to domestic demand, haa;ever, have necessitated
the regular importation of small quantities of products (about 4,000 bpd)
for the past several years.
The estimates and conclusions in this report represent the best judg-
ment of this Office as of 15 May 1964.
Dollar values are in US currency throughout this report.
When used in this memorandum, the term domestic demand is intended to
describe the quantity of petroleum that is removed or disappears from
supply. Demand includes the quality of oil consumed, lost, and issued
as bunker fuel in the country.
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The Indonesian petroleum industry was developed by foreign oil
companies, but since 1958, when Indonesian gained its independence,
the government has become increasingly active in establishing its
participation in, and control of the industry. From 1960 until 1963
expansion of the industry was slowed down because of prolonged negotiations
between the oil companies and the government over the future status of the
companies az4 the awarding of new areas fox exploration. Finally, follow-
ing a high-level meeting attended by President Sukarno and representatives
of the government of the United States, the oil companies and. the Indonesian
government signed an agreement in Tokyo on.l June 1963. This agreement,
subsequently 4.ncorporated into contracts ratified by law in November 1,963,
established rules of operation for the, foreign oil companies in Indonesia
and provided for the opening of new areas for exploration.
The essential features of the agreement provided that each of the foreign
oil companies would operate as a contractor to a government-owned company,
that profits would be split 60 percent to the Indonesian government and
4+0 percent to the oil companies, that, within 15 years, all marketing
and refining facilities would be turned over to the Indonesian government,
that the oil companies would make availablq;a proportionate share of their
production to meet Indonesia's domestic requirements for petroleum, and
that the oil companies would have the right to repatriate profits freely.
The oil companies paid $15 million in bonuses to acquire new acreage and
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agreed to spend a combined total of $65 million in exploration in the
next eight years (1964-7l)-
Because of the rapid growth of production of crude oil elsewhere in
the Free World, Indonesian petroleum is no longer a major contributor
to world supply. Moreover, except as a possible source of supply for
Communist countries of the Far East, Indonesian petroleum is not of
particular. importance to the Communist-;world. The major significance
of Indonesian petroleum is to Indonesia itself -- as an export commodity
and a valuable earner of foreign exchange. The petroleum industry represents
one of the few healthy sectors of the domestic economy, and, barring unusual
interference. by the Indonesian government,;:rospects are favorable for
the expansion o; production and exports of,crude oil. In spite of some
problems with respect to quality and the inpreasing availability of crude
oil in world markets, Indonesia represents :a convenient source of supply
to its principal customers, the countries of Asia and the Fur East. Moreover,
petroleum represents a ready source of-enemy for the development of
domestic industry when conditions permit. The government of Indonesia has
indicated its ayareness of the importance of the petroleum industry -- both
now and in the future -- and of the assistance of foreign oil companies in
the operation,of the industry, and appears to have reached a mutually
acceptable modus vivendi with the oil companies. Nevertheless, the
continuing pressures within Indonesia for te nationalization of all foreign
3 -
25X1
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properties
pose a constant threat to the successful development and expansion of the
Indonesian petroleum industry.
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I. Introduction
The economy of Indonesia has been in a serious condition for the
past'several years. Measures for economic stabilization adopted in the
first half of 1963 have been largely abandoned, and the situation at the
end of the year appeared even more critical than that at the end of 1962.
The continued deterioration of the Indonesian economy during 1963 resulted
in increased deficit spending, a rapid increase in the volume of money in
circulation, a decline in the level both of exports and imports, and a
dangerously low level of foreign exchange reserves (about $50 million in
December 1963). Chronic difficulties resulting from inefficiency and mis-
management, stagnation or decline in the production of important export
crops, lack of spare parts and raw materials, and bottlenecks in the
distribution system were exacerbated in the. last half of 1963 by President
Sukarno's policy of confrontation against Malaysia. The abrupt decision to
terminate all trade with Malaysia upset traditional channels for exports,
particularly for exports of rubber, Indonesia's most important export commodity,
and for imports of essential goods. Moreover, the policy of confrontation
has jeopardized expected foreign aid, particularly from the United States;
and such aid was a major factor in Indonesia's plans for economic stabilization.
In the chaotic economic situation which prevailed in Indonesia in
1963, the petroleum industry emerged as one of the few bright spots in
the economy. In June 1963, after protracted negotiations and as a result
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of the direct intervention of the government of the United States, an
agreement was reached regularizing the status of the foreign oil companies
that control most of Indonesia's petroleum industry. Production of
petroleum in 1963 declined slightly from the level of 1962, but the
value of exports of petroleum in 1963 increased, in spite of some difficulties
encountered as a result of the embargo on trade with Malaysia.
II. The Petroleum Industry*
1. Background and Development
The Indonesian petroleum industry has been developed almost
entirely by foreign interests. The first company to start production of
crude oil in Indonesia was the Royal Dutch Petroleum Company, the original
company of the Royal Dutch/Shell group.** By 1911, this group was
producing crude oil in North Sumatra, South Sumatra, East Java, and
eastern and northeastern Borneo. In 1912, the Standard-Vacuum Petroleum
Company, jointly-owned by the Standard Oil Company (New Jersey) and the
Socony Mobil Oil Company, *** began exploration and was successful in developing
Major facilities of the petroleum industry in Indonesia in 1963 are
shown on the map, inside back cover.
The original name of the company, formed in 1890, was the Royal
Dutch Company for the Working of Petroleum Wells in the Netherlands
Indies. The current name of the company is Perseroan Terbatas Shell
Indonesia (P. T. Shell Indonesia), a limited liability company
registered in Indonesia.
The name of Stanvac's company currently operating in Indonesia is
Perseroan Terbatas Stanvac Indonesia, a limited liability company
registered in Indonesia. Stanvac's properties in Indonesia continue
to be jointly held by Standard Oil of New Jersey and Socony Mobil.
~/ V w v tia
V
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F~ rP) 7
commercial production in South Sumatra and, on a small scale, in East
Java. Another U.S. company, Caltex, jointly owned by the Standard Oil
Company of California and Texaco, Inc., entered the picture in 1931.*
Caltex explored successfully in Central Sumatra and had. just established
production in the area when World War II began. In anticipation of the
Japanese occupation, which occurred in l912, the government of the
Netherlands Indies took measures to render, ineffective the producing wells
and other facilities of the petroleum industry. l/*-*
After World War II, Caltex, Shell, and, Stanvac returned to Indonesia
to rehabilitate their properties and to reactivate the petroleum industry.
Because of war damage and because certain.areas were inaccessible due to
political unrest, the three companies did not return to all of the areas
where they had been active before the war.,. Caltex directed its efforts
toward the development of its two principal fields, Duri and Minas, in
Central Sumatra, while Stanvac rehabilitated its facilities in South
Sumatra. Shell initially concentrated its.efforts on the rehabilitation
of its properties in South Sumatra and in Borneo and later to some
properties in East Java. In order to encourage the redevelopment of the
The name of the company currently operating in Indonesia is Perseroan
Terbatas Caltex Pacific Indonesia, a limited liability company registered
in Indonesia. Two affiliates of the parent companies, California Asiatic
Oil Company and. Texaco Overseas Petroleum Company also have a joint
contract with the government covering exploration in new areas.
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petroleum industry in the post-war period the three companies, Caltex,
Stanvac, and Shell, negotiated agreements with the government, which
granted the companies the right to remit profits freely and provided for
the payment to the government, including royalties and taxes, of 50 percent
of the over-all profits from their operations. The agreements under which
Stanvac and Shell operated expired at the end of 1960, whereas the Caltex
agreement expired in 1963.
These agreements facilitated the re-establishment of the industry,
but activities of the petroleum companies were limited to old concessions,
pending the adoption of a new petroleum law, and no new acreage was granted
for exploration. After Indonesia achieved. its independence in 1949, the
government began to increase its efforts to participate in and control the
petroleum industry and to increase its revenues derived therefrom.* Abandoned
or inaccessible properties of the foreign oil companies reverted to the
government and eventually three government enterprises were established:
Perusahaan Negara Pertambangan Minjak Nasi.onal (Permina); Perusahaan
Negara Pertambangan Minjak Indonesia (Pertamin); and. Perusahaan Negara
Pertambangan Minjak dan Gas Nasional (PermLgan).
Before World War II, the government of the Netherlands Indies had a
nominal interest in the industry through its 50 percent ownership of
Nederlandsch-Indische Aardolie Maatschappij (NIAM). The remainder
of the company was owned by Royal Dutch/Shell. 2/
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In 1957 Permina, the oldest of three state enterprises, took over
operation of the former Shell interests in North Sumatra, which had been
controlled by the Indonesians since the end of World War II. Pertamin
was formed in 1961 to take over the government's interest (from its former
partnership with Shell) in concessions in the Djambi area in South Sumatra
and the Bunju area in Borneo. Permigan, the smallest of the three government
companies, acquired two producing fields in, East Java before 1962. In
1962, Permigan purchased Shell's other fields in East Java as well as
the small refinery at Tjepu and the connecting pipeline. 3/
In addition to establishing its own petroleum enterprises, the
government of Indonesia, in October 1960, promulgated a new petroleum law
establishing the procedures for future operations in the petroleum industry.*
The essential provisions of this law established that all crude oil and
natural gas in Indonesia were national resources controlled by the State
and that exploitation of these resources was to be carried out only by
State Enterprises, i.e. government-owned oil companies, although other
parties could be appointed as contractors to these companies. With respect
to existing concessions the law provided that they should remain in effect
until new contracts could be arranged and contractors to government companies
The law was in fact a Government Regulation in-the-Place-of-a-Law, No.
44 year 1960, referred to as "The Regulation on the Mining of Mineral
Oil and Gas."
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could be appointed. The law also stipulated that each contract between
a foreign company and a government company would be ratified by law and
that the terms of the individual contracts would be determined by the
government. The new law resulted in an extended period of confusion, un-
certainty, and relative inactivity in the Indonesian petroleum industry.
Negotiations to draw up new contracts between Caltex, Stanvac, Shell, and
the Indonesian government continued unsuccessfully for about two and , one-
half years (November 1960 - May 1963)., during which time investment by the
oil companies was at a minimum level., The atmosphere during the negotiations
was clouded by recurrent rumors of impending nationalization of the industry
by the government and of purported offers by communist countries to assist
Indonesia in the operation of its own petroleum industry. Finally, in May
1263, a meeting of representatives of the oil companies, representatives of
the government of the United States, and President Sukarno and other
Indonesian officials was held in Tokyo. The meeting resulted in an agree-
ment, signed in Tokyo on 1 June 1963, . and. subsequently incorporated into
contracts, signed on 25 September 1963 and ratified by law on 28 November
1963.
Under the terms of the new contracts each of the oil companies has
relinquished its former concession area to a government oil company and
will operate in the future as a contractor to that company. Caltex will
operate as a contractor to Pertamin; Stanvac, to Permina; and Shell, to
Permigan. The essential features of the contracts provide that the
/o
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companies will continue to produce and export crude oil from their former
concessions for a period of 20 years (1983); that each company will provide
a proportionate share of its production to the Indonesian government, at
an agreed price, to meet domestic requirements for petroleum; that profits
will be split 60 percent to the Indonesian government and 40 percent to
the oil company; and that existing refining and marketing facilities
gradually will be turned over to the,government at an agreed rate of.com-
pensation, payable in convertible currency. The contracts also make
provision for the companies to acquire new acreage for exploration and
development for a period of 30 years,, Each company paid a bonus.of $5
million to the government to acquire this acreage, and the three. companies
are committed to expend a combined total of $65 million on exploration in
the next 8 ,years (196+-71).
In addition to Caltex, Stanvac,,and,Shell, a number of other foreign
companies have signed contracts since 1957 to engage in exploration and/or
to provide assistance to government oil companies in the development of
existing fields. In June 1962 the Pan American Indonesian Oil Company,
a wholly-owned subsidiary of the Standard Oil Company of Indiana,, signed
a 30-year agreement to operate as a contractor to Pertamin in the exploration
* Marketing facilities will be taken over by the government within 5 years;
refining facilities, in 10 to 15 years. Any refining facility retained by
an oil company until the end of the 15-year period (1978) will be acquired
by the government without compensation.
** StanvacV and Shell 5-11 each signed one contract covering both former
concessions and new areas. The contract signed by Caltex / covered only
its former concession area; a separate contract 7/ signed by California
Asiatic Oil and Texas Overseas Petroleum,,, o Viers new areas, for which Caltex
will probably be the operator. ELUDE I
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of a large area in Central Sumatra. Pan American's contract, which is
similar to those of Caltex, Stanvac, and Shell, provided that profits
would be divided 60 percent to the Indonesian government and 4+0 percent
to Pan American. The company also agreed to pay a bonus of $5 million to
the government to acquire the acreage and to expend about $28 million on
exploration in the first 8 years of contract.
Permina,,in addition to its contract-with Stanvac, has several production-
sharing contracts with other foreign companies. Refining Associates
Limited, an independent Canadian company, signed a contract in 1958 to
assist Permina in the development and rehabilitation of its oilfields in
North Sumatra. The contract, renewed in 1960 to extend until 1965, provides
that Refining Associates will extend credit as well as consultative and
engineering, services and will take payment. in crude oil. A marine drilling
vessel owned by the Western Offshore Drilling and Exploration Company,
Long Beach, is being operated under contract to Refining Associates in an
off-shore,.test in the Strait of Malacca. Permina also has contracts with
the Asamera,Oil Corporation Ltd. of Calgary and with the North Sun atra Oil
Development Cooperation Company, Limited (Nosodeco), a consortium.of
Japanese firms. Asamera's contract,. signed in 1962 is for an on-shore
* Pan American's contract was also ratified by law in November 1963.
Asamera owns a 45 percent interest in the contract. Other members of the 25X1
group are: Central - Del Rio Oils Limited, 33 3/4 percent; Benedum - Trees
Oil Company, 11 1/4 percent; and Refining Associates Limited, 10 percent.
n Pih~
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and off-shore exploratory and development program to re-establish commer-
cial production in a 750,000 acre area in North Sumatra, north of Langsa.
The Asamera group will take 40 percent of any production of crude oil that
is developed and Permina will take 60 percent. Nosodeco signed a 10 year
contract in 1960 to rehabilitate and develop production in an area around
Rantau, south of Asamera's area. Nosodeco provides credits in the form of
machinery and technology and receives, as payment, 40 percent of the annual
production of crude oil in excess of 800,000 kiloliters. 9/
In 1963, Permigan also signed an agreement with a Japanese group, the
Ceram Island Oil Development Association. The Japanese will investigate
the possibility of rehabilitating former Shell oilfields on the island of
Ceram and at Tjepu in Java, and will conduct aerial surveys of possible
oil areas in West Irian. If the prospects are favorable, a production-
sharing agreement similar to Permina's agreement with Nosodeco will probably
result. 10/
Early in 1964 Pertamin began negotiations with a third Japanese group
to develop production around the Bunju oilfield in Borneo. Investigation
of the area is still underway and no contract has yet been signed. 11/
Government. administration of the petroleum industry in Indonesia is
carried out by the Directorate of Petroleum and Natural Gas in the Ministry
of Basic Industries and Mining. It is rumored that the ministry, headed
by Chaerul Saleh, who is also third deputy prime minister, will be split
and that a separate ministry for petroleum will be formed.
h~ _6
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In accordance with the contracts signed in November 1963, Saleh has
implemented plans for the takeover of marketing and distribution facilities.
On 6 January 196+ Pertamin was designated as the government company charged
exclusively with the organization of all distribution of petroleum products.
Permina has been designated to provide marine transportation as it acquires
the necessary capabilities, and has instituted a program to purchase tankers
12
for this purpose.
2. Current Status (1963)
Indonesia is the only important producer of crude oil in Asia
and the Far East. Its proved reserves of-crude oil amount to almost 11
billion barrels (about 3 percent of the Free World total) and reserves of
natural gas, most of which are associated: with crude oil, are estimated to
be about 40 billion cubic meters. Most of the crude oil is produced by
_J
Caltex, Shell,, and Stanvac, with Caltex alone accounting for more than 50
percent of the total. Total refining. capacity amounts to about 2$0,000
barrels per day (bpd), of which more than 95 percent is owned by Shell (68
percent) and Stanvac (29 percent). Caltex has no refining facilities in
Indonesia. Production and refining facilities not controlled by the "Big
Three" are owned by the government companies.
Summary data on Indonesian production, consumption, imports, and exports
of petroleum for the years 1958-63 are shown in Table 1. More detailed in-
formation on the operations of the Indonesian petroleum industry is given
in Appendix A.
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Indonesia: Production, Consumption, Imports, and Exports of Petroleum a/
1958-63
Thousand Barrels per Day
1958
1959
1960
1961
1962
1963
Production
333
381
416
426
458
445
Imports
24
45
44
54
31
28
Exports
152
181
-221
238
251
257
Net supply
205
244
240
242
237
215
Petroleum Products
Production
220
240
237
219
220
200 b/
Imports
4
4
4~1
4
2
4 b/
Exports
137
147
140
129
124
108
Net supply
87
97
101
94
99
96 b/
Demand for Petroleum Products
Inland consumption
57
58
61
69
77
77,
Bunkers
12
15
17
21
17
16
Total consumption
68
73
78
90
93
93 b/
Product transfers and stock changes
19
24
23
4
6
3 b/
Total demand
87
97
101
94
99
96 b/
a. Data are rounded to nearest 1,000 barrels per day. Because of rounding, com-
ponents may not add to the totals shown.
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Production of crude oil in Indonesia in 1963 amounted to
145,000 barrels per day (bpd), of which an average of 257,000 bpd was
exported. Production of petroleum products in Indonesia in 1963 is
estimated to have averaged 200,000 bpd, of which 108,000 bpd were exported.
Although exports of crude oil in 1963 showed a slight increase (about 2.5
percent) over 1962, exports of products declined by more than 13 percent
and production of crude oil declined by about 3 percent. Exports of petro-
leum products have declined steadily since 1959, as a result of increasing
domestic consumption, but the sharp decline registered in 1963 resulted
primarily from Indonesia's policy of confrontation against Malaysia.
Traditionally, a major portion of the products exported from
Indonesia have been destined for Singapore, where they entered the entre-
pot trade, and, to a lesser extent, for Malaya for consumption. The loss
of this market created severe problems in the export of products and in
domestic refining operations in Indonesia. For the first nine months of
1963, exports of petroleum products averaged 123,000 bpd, only slightly less
than average for the year 1962; in the last quarter of 1963, following
confrontation, exports of products fell to about half of the previous level.
The over-all decline in the production of crude oil, in spite of increased
exports, is also attributable to confrontation. Most of the decline re-
sulted from a reduction of crude oil production by Stanvac because of
reduced throughput at its refinery.
14+
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The initial impact of the loss of Malaysian facilities was
alleviated somewhat by Indonesia's subsequent agreement to the use of
installations in Malaysia for blending and in transit storage. At present
information is insufficient to assess completely the long-term effect of
confrontation on exports of products. Exports of crude oil, which have
represented an increasingly larger share of Indonesia's total exports of
petroleum since 1959, normally have not gone to Malaysia and thus were not
affected by confrontation.
Since 1960, the vagaries of the political and economic
situation in Indonesia have hampered the development of the petroleum
industry, and actual expansion of production has not been commensurate with
the estimated potential for expansion. The ratification of the contracts
with Caltex, Shell, Stanvac, and Pan American is expected to result in a
greatly increased rate of activity in the exploration for new reserves.
Prospects for success in the discovery of new fields and the development of
new production are considered to be very favorable, and should result in
increased exports of crude oil and increased foreign exchange earnings.
III. Significance of Indonesian Petroleum in the World Situation
1. General
Although Indonesia is the only important producer of crude oil
in Asia and the Far East, its resources of petroleum are of major signifi-
cance to the Indonesian economy rather than as a source of petroleum in the
world pattern of supply and demand. Exports of petroleum represent a
-"7-
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valuable and relatively stable source of foreign exchange earnings for
the Indonesian government. To the importing countries, Indonesian petro-
leum constitutes a convenient, though not indispensable, source of supply.
Moreover, Indonesian petroleum faces increasing competition in world
markets in the next few years. The rapid increase of production in other
areas of the world, particularly in Africa, and the growth of the super-
tanker fleet, with resultant economies in transportation, will increase
further the availability and accessability of crude oil in the world market.
In addition, Indonesian crude oil has some disadvantage with respect to
quality because of its high viscosity and wax content. Most of the exports
of crude oil from Indonesia in the past few years, however, have represented
sales by Caltex and Stanvac to their affiliates, and these markets will
undoubtedly be maintained. Permina and the other government companies also
have established markets for at least part of their output of crude oil
as a result of production-sharing agreements with foreign contractors.
2. Significance to Indonesia
Indonesia's most important natural resources
and, after rubber, is the country's most important export commodity.
More than 50 percent of Indonesia's production of both crude oil and
petroleum products has been exported, primarily to countries in Asia and
the Far East. During the period 1958-62, the total value of exports of
petroleum from Indonesia amounted to $1.3 billion dollars. Preliminary
* The value of Indonesian exports, including rubber and petroleum, for
the years 1958-62 is shown in Table 2.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
estimates indicate that the value of exports of petroleum in 1963 was
roughly $230 million, a slight increase over 1962 in spite of the trade
embargo against Malaysia. Net foreign exchange earnings to the Indonesian
government from exports of petroleum were about $80 million annually in
1962 and 1963. Earnings in 1964 are expected to be at about the same level.
Information on the total contribution of the petroleum industry
to Indonesia's. revenues and to the Indonesian economy is incomplete. In
1961 direct revenues from the petroleum industry were expected. to contri-
bute about 11 percent of total planned. revenues (7.3 billions of rupiahs)
in the budget for that year. Local expenditures by the oil companies for
wages, goods, and services undoubtedly made a substantial additional contribution
to the economy.
As a result of the contracts with Caltex, Stanvac, and Shell
that were ratified in November 1963, the Indonesian government received
$15 million in hard currency from the oil companies as bonuses for new
acreage and an additional $30 million from Caltex for past operations. The
total of $45 million paid by the three companies was almost equal to the
estimated total foreign exchange holdings of the Indonesian government at
the end of 1963. Moreover, the contracts provided for stipulated expenditures
for exploration. During the eight-year period 196+-71, an average of
almost $12 million annually will be expended on exploration by Caltex,
Stanvac, Shell, and Pan American combined. This sum, though not unusually
large for exploration activity, will provide a healthy infusion of capital
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
into the economy in addition to the contribution from established
petroleum operations. Successful exploration and the development of new
production would result in addi;;ional bonuses and greater foreign exchange
earnings for the government and would probably result in a higher level
of expenditures by'the oil companies.
Because of the limited industrial development in Indonesia, the
major significance of petroleum in the economy has been as an export
commodity and as an earner of foreign exchange. The use of petroleum as a
fuel for the generation of electric power and in railroad transportation
has increased, however, and the first chemical fertilizer plant to utilize
natural gas in Indonesia is scheduled to go into operation in 196+. The
resources of petroleum -- particularly natural gas which is now largely
flared -- offer a ready, inexpensive source of energy for industrial plants.
Moreover, effective use of natural gas as a source of energy would permit
industrialization without detriment to the important export trade in
petroleum.
3. Significance of Indonesian Petroleum to Importing Countries
of the Free World
There are four main importers of Indonesian crude oil: Japan,
the United States, Australia, and the Philippines. Of the total quantity
of crude oil imported by these countries in 1962, imports from Indonesia
represented the following shares: US, 6 percent; Japan, 11 percent;
Australia, 23 percent; and the Philippines, 42 percent. The Philippines,
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
which imports the largest percentage of its total supply from Indonesia,
has no commercial production of crude oil. It is entirely dependent.on
imported crude oil to meet the needs of its local refineries, and there
are no prospects for the development of significant domestic production of
crude oil in the next few years. Although Japan and Australia are now
dependent on imports of crude oil for a major part of their petroleum
supply, such dependence is expected to decline gradually in the coming years.
Australian production of crude oil from the Brisbane area is expected to
begin in 1964, and Japan's production from its concession in the Persian
Gulf is expanding rapidly. Rising demand and planned additions to refining
capacity in these countries, however, suggest that they will continue to
provide a market for exports of crude oil. The United States imports
relatively small quantities of crude oil in relation to its total supply of
petroleu, and no significant change in the level of its imports from
Indonesia is anticipated in the near future. 16/
In additon to the established, markets for Indonesian crude oil,
the planned construction and/or expansion of refining capacity in several
countries in the Far East area will provide potential new markets for
Indonesian crude oil. Burma contracted for the import'of a small quantity
.of Indonesian crude oil in 1963 to meet the needs of its expanded refining
capacity, and additional quantities are to be imported in 1964. Other
countries in the Far East area which plan new or expanded refining facili-
ties that might use Indonesian crude oil are Thailand, South Korea, New
Zealand, Pakistan, and Malaysia.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
In its established markets and in the developing new market in
Asia and the Far East, Indonesian crude oil has a competitive advantage
because of its proximity and the resultant lower freight rates. The in-
creasing supply of crude oil in the world and shortcomings of Indonesia
crude oil with respect to quality, however, tend to offset some of that
advantage. Future increases in exports of crude oil from Indonesia to
the Free World will depend not only on the development of new production but
also on the reliability of supply, attractive pricing, and tie-ins with
affiliates of the major oil companies.
Indonesia's exports of petroleum products have declined steadily
in the past few years, and, as in the case of crude oil, no importing
country is believed. to be dependent on Indonesia for its supply of
petroleum products. A major part of Indonesia's exports of products
traditionally has entered the entrepot trade in Singapore and the ultimate
disposition of these products cannot be readily determined. Most of the
products, however, probably were used for international bunkers in Malaya
and Singapore. Of the countries that import petroleum products directly
from Indonesia, only Thailand, Laos, Cambodia, and South Vietnam receive a
significant share of their total supply from Indonesia.. Thailand produces
a nominal amount of crude oil that is processed locally, but most of its
supplies of petroleum are imported in the form of products. The other three
countries are entirely dependent on imports of petroleum products. In 1962,
imports of petroleum products from Indonesia represented more than 20 per-
cent of total imports of petroleum by Thailand and Laos and almost 40 percent
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of total imports of petroleum by Cambodia and South Vietnam. Imports
of petroleum products from Indonesia by Japan, Australia, New Zealand,
and the Philippines represent less than 10 percent of total imports of
products in each country. Furthermore, except in the case of New Zealand,
which has no domestic refining capacity, imported products represent a
relatively small share of total domestic supply in these countries. The
continued expansion of refining facilities in the Far East area will tend
to reduce further Indonesia's importance as a source of petroleum products.
4. Significance of Indonesian Petroleum to Communist Countries
Indonesian petroleum has not thus far been exported to any
Communist countries. As a potential source of supply, however, Indonesia
could be of particular importance to Communist China, North Korea, and
North Vietnam. In 1962, these countries imported about 50,000 bpd of
petroleum products from the USSR and other Communist countries; imports in
1963 probably averaged about 40,000 bpd. Although Indonesia now exports
products in excess of this total quantity, the requirements for specific
products could not be met except at the expense of the Indonesian economy.
Indonesia does not have significant quantities of kerosine (including
aviation kerosine) available for export. In 1962, however, kerosine repre-
sented at least 22 percent of the total products imported from the USSR by
Communist China, North Korea, and North Vietnam. Motor gasoline and diesel
* Trade statistics of the USSR do not show quantities for jet fuel imports,
which are believed to be included in the gasoline category. If China's esti-
mated imports of about 450,000 tons of jet-fuel in 1962 are added to the
kerosine category, kerosine accounts for about 40 percent of total imports. 18
-
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fuel could be supplied from Indonesia, but there is little or no require-
ment for fuel oil, Indonesia's principal product for export. At present
the Indonesian government does not own refining facilities adequate to
supply products for export. To obtain such products, the government would
have to levy on foreign companies for a share of their surplus products
that are currently exported to countries of the Free World for hard currency.
The export of petroleum products to Communist China, North
Korea, and North Vietnam does not appear to offer any economic advantage
to Indonesia, although the possibility that Indonesia might export small
quantities for political reasons cannot be ruled out.
Communist China, the only one of the three communist countries
in the Far East with refining facilities, apparently has produced enough
crude oil since 1960 to supply its own refineries at their effective operat-
ing capacity. As a result of reported additions to capacity in 1963, how-
ever, China could represent a possible market for as much as 20,000 30,000
bpd of Indonesian crude oil for its coastal refineries. The Indonesian
government could readily acquire this amount of crude oil from the foreign
oil companies as payment in kind for part of its share of profits. As in
the case of petroleum products, the export of crude oil to China by Indonesia
probably would be politically, rather than economically, motivated. A
recent trade agreement between North Korea and Indonesia included crude oil
among the commodities to be imported by Korea, but there is no evidence
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that Korea, at present, has refining facilities to utilize crude oil.- 19/
For the USSR and the European Satellites, Indonesia has little
to offer as a potential source of supply of petroleum because of the long
distances involved. in transport and because the USSR and Rumania are both
exporters. A possible area of interest would. be in the supply of Indonesian
petroleum to the Soviet Far East, but it is unlikely that any such transac-
tion is contemplated..
The countries of the Soviet Bloc have shown relatively little
interest in the development of Indonesia's petroleum industry. In 1961
Rumania agreed to provide $50 million in assistance to Indonesia, of
which $35 million is earmarked for the construction of a refinery and
the rehabilitation of oilfields in the area controlled by Permigan.** In
the three years since the credit was granted there have been no drawings against
it. A few Rumanian technicians have recently been sent to Indonesia,
presumably to assist in the development of Permigan's oilfields and to
discuss plans for the refinery. Permigan, however, has also enlisted
Japanese assistance in the development of these same oilfields and apparently
there is no immediate intention to proceed with construction of the Rumanian-
aided refinery. A few Indonesians have been sent to the USSR and to Rumania
for training in various aspects of the petroleum industry. No other
technical or material assitance to the Indonesian petroleum industry has
been provided by countries of the Bloc. 20/
Construction of a refinery with an annual capacity of 40,000 bpd is
reportedly underway in North Korea. Although the refinery would be
dependent on imported crude oil, completion of the plant is not
expected until at least 1966.
Only 85 percent of this assistance is to be provided as a long term
credit.
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IV. Problems and Prospects of the Indonesian Petroleum Industry
Although the production of crude oil in Indonesia has increased
significantly since 1958, the growth of the industry has been hampered,
particularly since 1960, because of the unsettled conditions under which
the oil companies operate. After the signing of the agreement in Tokyo in
June 1963, it appeared that the basic problems affecting operations of the
oil industry had been resolved. The atmosphere of harmony and optimism
was short-lived, however, as the policy of confrontation against Malaysia,
announced in September 1963, created new problems for the industry and re-
vived or intensified the hostility against foreign interests, particularly
British.
One problem that continues to plague the foreign oil interests is
the fear that their assets will be expropriated. Both President Sukarno
and Chaerul Saleh, Minister of Basic Industries and Mining, have said that
they want foreign oil companies in Indonesia and that they look forward to
a mutually beneficial era of cooperation. In spite of these assurances,
however, there is continuing pressure, particularly by the Communist labor
unions, for the expulsion of all foreign interests. There have been re-
curring instances of the occupation by the workers of British oil facilities
since the confrontation. The most serious incident has involved the Shell
refinery at Balikpapan in Borneo, and has been sanctioned (if not instigated)
by the local military commander. Immediately after the confrontation this
refinery was taken over by the Indonesian staff and for some time the.
- ~7
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expatriate staff was held incommunicado. The situation appears to have
been resolved for the present by Shell's replacement of all of the expatriate
staff of British origin with other foreign nationals and by Saleh's decree,
issued in December 1963, restoring control of the refinery to Shell manage-
ment. 21/
The take-over by Pertamin of marketing and distribution operations
within Indonesia is also giving rise to some problems that could affect
the operations of foreign oil companies. Formerly the oil companies, through
the sale of products on the domestic market, obtained rupiahs adequate to
cover their local requirements for wages, taxes, and so forth. Now the oil
companies sell the products to Pertamin, rather than to the consumer, and
rupiah payments have been slow (indeed none have yet been received). Unless
Pertamin reduces the time lag between. receipt of shipments and payment to
the companies, which seems unlikely in terms of normal government operations,
the oil companies will be compelled to increase rupiah working capital
through conversion of hard currency earnings into rupiahs. The unfavorable
legal rate for this conversion will add to the companies' cost of operation.
Pertamin's take-over of marketing operations has also created some problems
with respect to personnel formerly employed by the oil companies for this
purpose. Pertamin probably will be forced to absorb these employees, although
initially it refused to do so on the grounds that it had an adequate staff.
Some shortages of petroleum products also are developing as a result both
of the change in marketing procedures and .as a result of the trade embargo.
These shortages have not reached serious proportions, however, and no major
problem on supply is expected. 22/
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The prospects for the petroleum industry in Indonesia are difficult
to assess. From an economic point of view, the indications are favorable
for an era of growth and expansion for the industry. The new areas to be
explored have a good potential for the discovery of new reserves and the
development of new production. The planned expansion of refinery capacity
in the Far East area and Indonesia's favorable position as the nearest
major producer of crude oil suggest that there should be a continued and
expanding market for Indonesian crude oil. The foreign oil companies are
committed to a sizable investment in exploration, government oil companies
have several production sharing contracts for the rehabilitation and expan-
sion of existing fields, and it is expected that exports of Indonesian
crude oil will continue to increase and that the rate of growth may well
expand.
No expansion of refining capacity in Indonesia is expected in the
next few years, and exports of petroleum products probably will continue
decline. Existing refining capacity, however, is more than adequate to meet
anticipated over-all domestic requirements, although imports of certain
types of products will continue to be necessary to supplement domestic
production.
Sukarno needs the oil companies and the
expected income from the oil industry. Leftist pressure for the seizure
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of all foreign interests and harassment at various oil installations are
expected to continue, however, and the effect of these pressures on
Sukarno's actions cannot be predicted. Although the foreign oil companies
are going ahead with their plans for exploration and development on the
basis of their existing contracts, no one is sanguine about the fact that
these contracts could not be abrogated at any time.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
THE INDONESIAN PETROLEUM INDUSTRY, 1958-63*
A. Crude Oil
I. Exploration and Production
Since 1960, because of the unresolved status of the foreign
oil companies, exploratory drilling in Indonesia has been at a very low
level. Of the 19 exploratory wells drilled during 1960-62, 17 were
drilled in 1960. With the conclusion of the working contracts in 1963,
however, and the awarding of new exploration areas, the exploration program
is expected to accelerate. In the period 1964-71 almost $100 million will
be invested in oil exploration in Sumatra and Borneo by Pan American,
C altex, Stanvac, and Shell; and additional exploration on a lesser scale
will be undertaken by government-owned oil companies. Several foreign oil
companies, not now operating in Indonesia, also have been negotiating for
expected to result in
a substantial increase in Indonesia's proved reserves of crude oil.
Althcugh there are some oilfields on the islands of Borneo and
.. _ .c.. c of _.. .L-. nu is i? derived primarily from oil-
fie ldo on the island of S matra, which accounted for almost 90 percent of
total production in 1963. Of the 63 oilfields being exploited in Indonesia,
the Minas oilfield in Sumatra, which was developed by Caltex, is by far the
most important producer. In 1,63 production from the Minas field accounted
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for 38 percent of total production in Indonesia.
Indonesian crude oils in general contain little sulphur and
have a somewhat higher gasoline content than the average Middle East crude.
These desirable characteristics are offset, however, by the fact that the
Indonesian crudes also have a high wax content and are very viscous. Crude
oil from the Minas oilfield has a wax content of up to 25 percent and is
almost so id, at 75 o
1, F.; crude oil from the Tandjung oilfield has a wax con-
tent of 33 percent and solidifies at 105?F. The viscosity and wax content
of most Indonesian crude oils necessitate special facilities for handling
and processing.
Total production of crude oil in Indonesia increased from about
17 million tons in 1958 to about 23 million tons in 1963. Three companies --
Caltex, Stanvac, and Shell -- accounted for about 90 percent of total pro-
duction in this period.
II. Refining
Total refining capacity in Indonesia as of 1 January 196+ was
almost 280,000: barrels (bpd). The two major refineries, which together
comprise more than half of the total refining capacity, are located near
Palembang in South Sumatra. They are the refinery owned by Stanvac at Sun-
gaigerong (go,000 bpd) and Shell's Pladju refinery (110,000 bpd.). The
only other major refinery is Shell's plant at Balikpapan in Borneo, with an
annual capacity of about 75,000 bpd. Small units are owned by Shell and
* The production of crude oil by company for the years 1958-63 is shown
in Table 3.
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by the government companies. Caltex, the major producer of crude oil, has
no refining facilities in Indonesia.*
Secondary processing facilities at the three largest refineries
include thermal and catalytic cracking, thermal reforming, alkylation and
polymerization units.** Except for lubricating oils, the refineries can
produce a full line of petroleum products, including aircraft fuels.
Indonesian refineries operate primarily on domestically produced
crude oil, although Shell regularly has imported small quantities of crude
oil and feedstocks for the production of products for export. Shell also
processes some crude oil produced by Pertamin, and Stanvac processes nominal
amounts of crude oil produced by Caltex. The products from these crudes
are distributed locally.
Since 1959 Indonesia's refineries have not been operated at capacity.
The output of refined. products has shown a small but steady decline, re-
flecting a corresponding decline in exports of petroleum products.***
III. Consumption
Domestic consumption of petroleum products (exclusive of inter-
national ships' bunkers) increased. from 57,000 bpd in 1958 to 77,000 bpd
in 1962./ Consumption in 1963 remained at about the same level as
A list of existing refineries is shown
in Table 4.
kk Capacities of the secondary processing facilities are shown in Table 5.
-x-X- The output of refined products by company and by type of product in
1962 is shown in Table 6.
Consumption of petroleum products in Indonesia, by type of product,
for the years 1960-62 is shown in Table .7.
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in 1962. About two-thirds of the petroleum consumed in Indonesia is
used on the island of Java; and in the country as a i.hole, oil ranks
after. fuelwood as a primary source of energy-. The principal products
consumed are kerosine, motor ga.;cline, and diesel fuels. Kerosine,
which accounted for 36 percent of total consumption in 1962, is used
primarily for household lighting and cooking. Diesel fuel is used
extensively in such industrial applications as the generation of electric
power -- it is estimated that about one-third of Indonesia's powerplants
are operating on diesel fuel -- and to an increasing degree in land and
marine transport.
In addition to products consumed domestically, including those
used for coastal and inland shipping, consumption of fuel for international
ships' bunkers averaged about 16,000 bpd in the period 1958-62.
IV. Marketing, Distribution and Storage
Because the government controls prices of petroleum within
Indonesia, profit margins in the retail market are narrow and the operating
oil companies are more interested in the export market for their petroleum.
As of 1961, Shell supplied. almost 40 percent of the local market; Stanvac,
about 30 percent; government companies, almost 20 percent; and Caltex, the
remainder. In May 1962, however, the Indonesian government issued a decree
whereby each company would be required to supply products to the domestic
market in proportion to its share of total crude oil production. Under
this pro-rated system Caltex, ;1Thich formerly supplied little more than 10
percent of the market, will be required to supply about half of the total
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domestic requirements. As a re:;ult of agreement signed in 1963,
actual distribution and marketing operations will be taken over by Pertamin,
and each foreign company will provide its pro-rated share of products to
the government at an agreed price. In determining the price of the products
to Pertamin, crude oil will be valued at cost plus 200 per barrel. Stanvac
and Shell will refine their own crude, at cost plus 100 per barrel, while
refining of Caltex's crude oil will be at commercial prices.
The principal means of transportation for crude oil in Indonesia
is by pipeline, although small tankers are also used to supplement pipeline
transport. Most of the crude oil that is produced is transported directly
from the oilfields to coastal terminals for export or to Indonesian refineries
for processing. Crude oil produced at Stanvac`s Lirik and Ukui oilfields
in Central Sumatra is moved first by pipeline to a marine terminal and
thence by tanker to the refinery at Sungaigerong in South Sumatra.
About 1,600 miles of Indonesia's total pipeline system of almost 1,900 miles
are used for the transport of crude oil.
Distribution of petroleum products within Indonesia is effected
principally by tanker and rail, although some pipelines are used to trans-
fer products from refineries to bulk storage installations. In Java products
are received by tanker at coastal storage installations and distributed in-
land primarily by rail. In other areas of the country distribution is
primarily by coastal and inland water transportation.
Major pipelines in Indonesia in 1963 are shown in Table 8.
-S5 -
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r
The extensive use of water transportation requires a large
fleet of small vessels, including tankers, barges, lighters and vessels
for shipments of packaged petrcle?wm. The Indonesian government has six
small tankers used for internn.y transportation, with a total capacity of
about 19,000 deadweight tons (d.w.t.). In addition Shell has a fleet of
31 tankers with a total capacity of almost 300,000 d.w.t., and Stanvac
has a few very small tankers.
Containers are used for distribution in remote areas and Shell
maintains a .plant for the manufacture of drums at Balikpapan. The plant
produces annually about 50,000 containers for regular petroleum products
and more than 300,000 drums for asphalt.
Bulk storage facilities in Indonesia have a total capacity of
23 million barrels, of which almost 16 million barrels are used for the
storage of petroleum products. Storage for clean products, exclusive of
lubricating oils, amounts to about 8 million barrels, or approximately
four months' supply at the 1962 rate of consumption. Crude oil storage
a mounts to about 7 million barrels, or approximately 25 days of supply on
the basis of a refining capacity of about 280,000 bpd.
V. Foreign Trade
Indonesia is a net exporter both of crude oil and petroleum
products. Exports of crude oil from Indonesia increased from about 150,000
bpd in 1958 to almost 260,000 bpd in 1963. Caltex is the largest exporter
of crude oil and, in 1962, its exports of 215j000 bpd represented more than
Major bulk storage installations. in Indonesia in 1963 are shown in Table 9.
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85 percent of total Indonesian exports of crude oil. The remainder was
exported by Permina (about 10 percent of total exports) and Stanvac
(almost 5 percent). Japan, the United States, Australia, and the
Philippines, are the major importers of Indonesian crude oil, and, in 1962,
these four countries received almost 98 percent of total Indonesian exports
of crude oil.
Exports of petroleum products from Indonesia decreased from a
high of almost-150,000 bpd in 1959 to 108,000 bpd in 1963. The decline
in exports of petroleum products reflects the growth of refining capacity
in other countries of Asia and the Far East, that traditionally have been
supplied from Indonesia. In 1962, the latest year for which complete data
are available, almost 70 percent of the products exported went to Malaysia,
about 20 percent went to other countries of Asia and the Far East, and the
remainder went to the US and elsewhere. The principal products exported
are fuel oil, diesel fuel, and motor gasoline. Shell and Stanvac are the
only two companies that export products from Indonesia, and in 1962, Shell's
exports amounted to 96,000 bpd, or almost 80 percent of the total.
In spite of its sizeable exports of petroleum, Indonesia also
imports crude oil and small quantities of products. Because its local
production of crude oil is inadequate to employ fully its refining capacity,
Shell has imported crude oil in bond for refining into products for export.
In the period 1958-62 and in the first 9 months of 1963, quantities imported
-} Exports of Indonesian crude oil, by country of destination, for the years
1960-62 are shown in Table 10.
** Exports of petroleum products from Indonesia in 1962, by destination and
by type of product, are shown in Table 11.
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for this purpose averaged about 40,000 bpd.
Imports of crude oil were discontinued in the last quarter of
1963, as a result of the trade embargo against Malaysia. Imports of
products averaged about 4,000 bpd in the period 1958-62, and probably
continued at the same rate during 1963. Products imported to supplement
domestic output consist mainly of lubricating oils, specialty products,
and small quantities of fuels.
B. Natural Gas
Proved reserves of natural gas in Indonesia amount to about 40 billion
cubic meters, including dissolved, associated and non-associated gas. Re-
serves of non-associated gas, which amount to about 7 billion cubic meters,
are located, entirely in southern Sumatra, in areas operated by Shell and
Stanvac. Although Indonesia's reserves of natural gas are not large in
comparison to the major areas of natural gas resources, they constitute an
additional source of energy for use in the development of the economy.
Exploitation of Indonesia's natural gas resources has been relatively
limited and in most cases the gas is used as fuel by the oil companies in
their operations or is flared. Stanvac, however, has five plants in southern
Sumatra that.produce small quantities of liquefied petroleum gas (LPG) and
natural gasoline. Stanvac also has completed a pipeline with a capacity to
transport 425,000 cubic meters per day of natural gas from the Radja oilfield
to Palembang. The pipeline will provide natural gas for a fertilizer plant
scheduled for completion at the end of 1963 -- the first significant commer-
cial utilization of natural gas in Indonesia.
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Table 3
Indonesia: Production of Crude Oil a/
1958-63
Producing
Company
1958
1959
1960
1961
1962
1963
Caltex
l-9
166
204
22i-
229
230
Shell
71
86
88
87
112
107
Stanvac
76
83
,8
72
70
63
Permina
5
13
16
16
4
25
Pertamin
28
32
30
25
20
18
Permigan
1
1
1
1
3
3
Total
333
381
417
2426
4 58
445
a. Data are rounded to the nearest 1,000 barrels per day. Because of
rounding, components may not add to the totals shown.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
Table 1-j
Indonesia: Primary Refining Facilities
as of 1 January 1964
Refinery
Owner
Annual Capacity a/
(Barrels per Day3
Pladju
Shell
110,000
Sungaigerong
Stanvac
80,000
Balikpapan
Shell
75,000
Tjepu
Permigan
5,100
Wonokromo
Shell
3,200
Pan k alansusu
Permina
1,200
Langsa
Permina
100
Pangkalan,Drandan
Perming
400
Rantau
Perming
100
Total capacity
280,000
a. Data are rounded to two significant digits. Because of rounding,
components may not add to the total shown.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
Table .-
Indonesia: Secondary Refining Facilities
as of 1 January 1964
Annual Capacity a/
{Barrels per Day?
Type of Facility
Sungaigerong Pladj u
B
alikpapan
Total
Vacuum distillation
52,000 24,000
14,000
90,000
Thermal cracking
22,000 10,000
0
32,000
Catalytic cracking
18,000 0
0
18,000
Thermal reforming
0 15,000
0
15,000
Alkylation
810 1,100
0
1,900
Polymerization
1,800 180
0
2,300
Solvent extraction
9,700 16,000
0
25,000
Wax production
1,100 0
7,800
8,900
a. Data are, rounded to two significant digits. Because of rounding,
components may not add to the totals shown.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
Ta U 1 e (1 .?
a
Indonesia: Output of Petroleum Products
1962
Product
Shell L/ Sta
nvac Caltex 1
Pertamin
Permigan
and Permina Total
Aviation
gasoline
1
1
0
0
2
Aviation
turbine fuel
0
3
0
0
3
Motor
gasoline
18 1
6
Kerosine
23
9
Diesel fuels
39 1
0
54
Fuel oils -
49 1
3
74
Lubricating
oils
Other
products
4
4
Total
134 5
3
22
220
a. Data are rounded to the nearest 1,000 barrels per day. Because of
rounding, components may not add to the totals shown.
b. Including the output of products derived from imported crude oil.
c. Products derived from crude oil produced by Caltex and processed in
Stanvac' s refinery.
d. Including almost 19,000 barrels per day of products delivered from crude
oil produced by Pertamin and processed in Shell's refineries.
hcusand Barrels Per Day
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
-;
.~ab
Indonesia: Consumption of Petroleum Products
1960-62
Tho
us
and Barrels
Per Day
1962
1962 Index
1960
1961
1962 (
Pe
rcent
(1960 =
100)
Aviation gasoline
1
c/
1
76
Aviation turbine fuel
J
1
1
1
733
Motor gasoline
18
20
22
29
126
1
Kerosine
25
1
26
28
36
110
Diesel fuels
11
11;
15
20
138
Fuel oils
5
6
8
128
Other
2
3
4
5
182
Total -- -
61
69
77--
100
125
a. Data are rounded to the nearest 1,000 barrels per day. Because of round-
in;, components may not add to the totals shown. Percentages and indexes for
1962 were derived from unrounded data.
b. Including bunkers for international aircraft but not for foreign ships.
c. Less than 500 barrels per day.
d. Including solvents, lubricating oils, asphalt, paraffin, and liquefied
petroleum gas. Consumption of lubricating oils in 1962 was about 1,300
barrels per day.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
Indonesia: B?~' S-oraSe Facilities for Petroleum a/
1953
Oil C1 an Dirty Urkro\,m b Total Total
Balikpapan 1,300 1,000 690 760 2,500 3,500
Dumai 1,000 0 0 0 0 1,000
Pladju u 1,300 2,100 6 30 2, 300 5,100 6, 400
Sambu 0 620 230 670 1,500 1,500
Sungaigerong 630 1,200 630 130 2,000 2,600
Sungaipakning 1,000 0 0 0 0 l~ 000
Tandjungperak 180 460 250 9 730 900
Tandjungpriok 0 620 180 23 820 820
Tand.junguban 270 1,100 190 0 1,200 1,500
Wonokromo 350 120 1 31 150 500
Other c/ 1,300 1,2OO 200 410 1,600 3,100
Total 7,400 8000 3,000 4,300 16,000 23, 000
a. Data are rounded to no more than two significant digits. Because of
rounding, components may not add. to the totals shown.
b. Including storage facilities for lubricating oils, naphtha, solvents,
paraffin, asphalt, feedstock, and unassigned tankage.
c. Storage installations with individual capacities of less than
500,000 barrels.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
-
IS.-c' c
Indonesia: -_rorts of Crude Oil a
19 63 -o2
Thousand Barrels per fl y
1960
1061
1962
Japan
65
78
96
United States
71
67
63
Australia
49
57
60
Philippines
26
26
27
Other countries =J
11
10
6
Total
221
238
251
a. Data are rounded to the nearest 1,000 barrels per day. Because
of rounding, components may not add to the totals shown.
b. Including Hawaii.
c. Principally India and West Germany.
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 Approved For Release 2008/08/07: CIA-RDP71T0073OR000500040003-1
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