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IJSTR >> Volume 5 - Issue 2, February 2016 Edition

International Journal of Scientific & Technology Research  
International Journal of Scientific & Technology Research

Website: http://www.ijstr.org

ISSN 2277-8616

The Utilization Of Resources And Regulation Along With Company’s Strategies In Managing Oil And Natural Gas Industry In Indonesia

[Full Text]



Sigit Rahardjo, Sucherly, Ernie Tisnawati Sule



upstream oil and gas industrial activities, oil and gas resources, regulation, management strategies, production performance.



Oil and gas production in Indonesia has been declined since 1995 up to now, the effort to increase the production has been done but it does not result yet. In contrast, day by day the investment is getting increased and huge; on the other hands, it becomes a problem and a challenge for Indonesia to meet oil needs as raw material for refined fuel oil either for transportation or industries. Day by day the needs of refined fuel oil is getting increased and huge as it is correlated to the increasing of the number of motorcycles either two-wheeled or four-wheeled as well as the increasing of oil and gas or non-oil and gas industries. Oil and natural industry (Resource Base) has specific characteristics those are internal factor that uses resource such as high technology, huge investment/ cost, as well as competent human resources. Besides, the external factor those are good regulations either in the central and regional levels as well as the sector which is very important toward the production performance and the of company management’s strategies to manage this industry. This paper attempts to figure out the impact of internal factor in the form of resources and external factor in the form of regulation as well as the effect of production performance toward petroleum companies of upstream sectors in Indonesia and management’s role, especially, petroleum industrialists in managing the company. The wane of oil production and the increasing of refined fuel oil need in Indonesia as well as the increasing of oil production cost then it will affect the industrialists’ strategies in managing the companies. The resources consist of human resource, oil reserve as well as petroleum technologies. While, regulation consists of law, central and regional government regulations and rules in oil and gas sector. Whereas, the company’s strategies are explained by production volume and selling volume of oil. Company’s performance which sets to work in upstream sector is influenced by various factors which are interconnected and it impacts on the companies at the same time. In addition, for the moment, the companies which engage in upstream oil and gas sectors in Indonesia are quite a lot either domestic (National Oil Company) or International Oil Company (IOC). Currently, companies in Indonesia are in the form of Production Sharing Contractor, Joint Operating Body and Cooperation Operation (KSO), and currently upstream sector companies specifically which are producing are more than 50 companies.



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