Jakarta - Oil and Gas Director General Luluk Sumiarso said that Indonesia's year-to-date oil production in April 2008 was recorded at 997,066 barrels per day (bpd).

"This oil production level needs to be maintained so that calcualtion based on the state budget could be realized until the end of the year," he told a discussion here on Wednesday night.

He said that Indonesia had the potential to raise its production to one million bpd but this potential needed to be exploited.

"What is now being exploited are old fields so that explorations to find new ones needed to be carried out in other areas," Luluk said.

Deputy Chief of the Upstream Oil and Gas Regulating Body (BP Migas) Abdul Muin said meanwhile that oil explorations in the country at present were being hampered.

"The constraint faced so far is legal certainties that caused high costs. World oil companies are exploring oils in countries where full reserves are found and offer low costs such as Africa," he said.

Therefore, he said, Indonesia needed to improve the risk factor and legal certainties. It also needed to conduct a new research on new areas that can be explored to attract investors.

He said that in the oil business in 2006 about 45 percent of the costs were used to search for new oil fields. "This must be given attention."

Muin said that exploring new oil fields was needed in an effort to stop the declining oil production.

The BP Migas deputy chairman predicted that Indonesia's oil output would continue to drop by about 12 percent unless new endeavor to find new oil fields were made.

He said that if new explorations were made it was expected that the declining oil output could be reduced to seven percent only.

On old oil fields that could be exploited again, Muin said that existing old fields had the potential to produce 50,000 bpd. "These ones are beyond those belonging to Pertamina (state-oned oil company)," he added.

- Source : Antara News Agency, 16 May 2008