JAKARTA, Oct 21 (Reuters) – Indonesia’s new government aims to revive oil and gas production, considering easing regulations, reactivating idle wells and increasing output from generating assets in hopes of reverse a decades-long decline in production, officials said.

President Prabowo Subianto, who was sworn in on Sunday, also plans to build on the previous administration’s efforts to exploit massive gas discoveries in the South Andaman and increase the use of biofuels.

Formerly a member of the Organization of the Petroleum Exporting Countries (OPEC), Indonesia’s oil production has fallen this year to less than 600,000 barrels per day (bpd), from a peak of around 1.6 million of b/d in the 1990s, due to the aging of the blocks and the weakness of investments.

At the same time, oil consumption in the world’s fourth most populous country more than doubled to 1.5 million barrels per day, leading to imports of oil and petroleum products that averaged 28 billion dollars per year over the past decade.

“We must be self-sufficient in energy and we are capable of being so,” Prabowo said in his inauguration speech, citing growing geopolitical tensions.

While Prabowo’s predecessors also sought to reverse the decline in production, investments were hampered by red tape as well as competition for financing, notably that of renewable energy.

“We will remove various regulations that hinder the exploration process, reducing the number of permits from 320 to 140, and we will reduce them further to shorten the process,” said Prabowo Energy Minister Bahlil Lahadalia on the 14th. october.

Komaidi Notonegoro, an energy analyst at the ReforMiner Institute, said exploration and production contractors must deal with 19 often rival agencies to obtain permits.

“Oil and gas entrepreneurs should be busy looking for new reserves instead of dealing with permits, it takes too long,” he said.

REACTIVATION OF STOPPED WELLS

To increase production, the new government plans to reactivate nearly 5,000 unused wells, Bahlil said.

“Our goal is to increase oil production by around 200,000 b/d by optimizing unused wells and technological intervention,” Bahlil said last week, without specifying a timetable.

“The government’s main concern is volume, but these entrepreneurs are running a business. The question is whether the government will be willing to compensate” for the additional cost, Komaidi said.

To reduce imports of liquefied petroleum gas (LPG), the new government aims to double production of the cooking fuel from 1.7 million tonnes per year, Bahlil said. Indonesia imports around 70% of the 8 million tonnes of LPG it consumes each year.

Prabowo also has ambitious goals to increase the use of biodiesel and bioethanol, which some experts say should be his main priority in the energy sector.

“We have to be realistic. Prabowo can no longer rely on oil and gas,” said Fahmy Radhi of Gadjah Mada University. “It would be better if he gave renewable energy a high priority and focused on that from the start.”

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Based in Jakarta, Fransiska reports on energy and raw materials news in Indonesia, a major exporter of various important products such as thermal coal, LNG, nickel, copper, palm oil and coffee. She also covers broader economic news and monetary policy.