The name Indonesia has its roots in two Greek words: "Indos" meaning Indian and "Nesos" which means islands. It is an appropriate description of the archipelago as there are estimated to be a total of 17,508 islands, of which only about 6,000 are inhabited, stretching for 5,150 km between the Australian and Asian continental mainlands and dividing the Pacific and Indian Oceans at the Equator.
Five main islands and 30 smaller archipelagoes are home to the majority of the population. The main islands are Sumatra (473,606 sq.km), Kalimantan 1539,400 sq.km), Sulawesi l 189,216 sq. km), Irian Jaya (421,981 sq. km), and last but not leastJava (132,187 sq.km), home to 70 percent of the country's population. Indonesia shares Papua with Papua New Guinea and two thirds of the island of Kalimantan with Malaysia and Borneo.
The Dutch began to colonize Indonesia in the early 17th century; Japan occupied the islands from 1942 to 1945. Indonesia declared its independence after Japan's surrender, but it required four years of intermittent negotiations, recurring hostilities, and UN mediation before the Netherlands agreed to transfer sovereignty in 1949. Free and fair legislative elections took place in 1999 after President Soeharto stepped down.
Indonesia is now the world's third most populous democracy, the world's largest archipelagic state, and home to the world's largest Muslim population.
Oil & Gas
The history of Indonesia’s petroleum industry goes back to the Dutch colonialism era and was marked by the beginning of systematic oil exploration in 1865. The first well was drilled in 1871, and the first oil field discovery was made in 1885.
Since the independence of Indonesia in 1945 and up to 1950, most oil fields had been discovered in East Java, South and Central Sumatra, and East Kalimantan. In 1966, Pertamina was established as a merger of several upstream and downstream Dutch oil companies.
The new Production Sharing Contract (PSC) system was first introduced in 1966. In 1971, a new law no 8 clarified Pertamina’sroles as an upstream and downstream operator, as well as contractors’regulator. A 2001 law specified the deregulation of the country’s oil and gas industry. BPMIGAS is now the regulator of the PSC contracts.
The Indonesian Production Sharing Contract is a Contract system where the Government of Indonesia (GOI) grants the PSC holder the rights to explore for and extract the hydrocarbons within the PSC area for an overall contract period of typically 30 years. A government agency - Badan Pelaksana Kegiatan Usaha Hulu Minyak Dan Gas Bumi (BPMIGAS) - administers the contract on behalf of te GOI.
The PSC holder (Contractor) must complete agreed exploration work (including an agreed number of exploration wells) within the first 6-year exploration period. If agreed the exploration period may be extended to a total of 10 years.
The Contractor pays for all exploration on the basis that this, and agreed operations costs, as cost-recoverable from the hydrocarbon sales.
The PSC contract is transferrable and allows for the Contractor to sell the PSC or to have other companies farm-in. Such a sale or farm-in is subject to BPMIGAS's approval.
The PSC contract system has been largely unaltered since its inception.
There are currently over 200 active PSCs in Indonesia and the overall production (Feb 2011) from PSCs, Pertamina and other contract types is 930,000 BOPD (Barrels of oil per day).
For further reference see the links below -