Coalbed Methane Prospects in Indonesia

Carpenter, Chris (JPT Technology Editor)


This article, written by JPT Technology Editor Chris Carpenter, contains highlights of paper SPE 186343, “Review of Coalbed Methane Prospects in Indonesia,” by C.  Irawan, D. Nurcahyanto, I.F. Azmy, J.A. Paju, and W.M. Ernata, SKK Migas, prepared for the 2017 SPE/IATMI Asia Pacific Oil and Gas Conference and Exhibition, Bali, Indonesia, 17–19 October. The paper has not been peer reviewed.

In 2005, two companies began studying the potential of seismic operations for the Kutai and South Sumatra basins (Fig. 1). However, the progress of coalbed-methane (CBM) operations has been slow for several reasons. This paper reviews the efforts to exploit CBM resources in Indonesia, the challenges these efforts have faced, and possible solutions that can make operations more efficient and profitable.


Despite the current industry climate, operators in Indonesia continue to pursue CBM production opportunities. The Indonesian government has stipulated in its contracts with these companies that current operations must yield production within a set time frame, highlighting the importance of making such operations cost-effective.

Currently, many methods are avail-able to drill CBM wells. In early efforts to exploit CBM wells, contractors used conventional methods to drill a well at a target depth of 500 to 800 m at a high operational cost, but time frames were not met. Of 51 exploration contract areas involving CBM in Indonesia, only 17% of these have fulfilled their commitment. Obstacles that prevent success in these endeavors are often nontechnical in nature, including organizational difficulties (suboptimal financial conditions of operators), land- and permit-acquisition issues, challenges in community relations, gaps in the supply chain, and problems with access and infrastructure. Standard operating procedures (SOPs) are difficult to formulate and implement under these conditions. The CBM well must follow industry operational standards, which, when com-pared with standards involved in the mining industry, for example, involve a higher level of technology and the need for more permits and, thus, a greater cost. 

Indonesia CBM Contract Area Indonesian unconventional prospects are essentially divided into two areas, Sumatra and Kalimantan. These areas contain the most abundant coal-seam prospects. However, proved resources do not equal the estimated resources calculated more than a decade ago.

Geologically, target coal seams in the Sumatra and Kutai basins differ only in their depth. The target coal seams in Sumatra are shallower than those in the Kalimantan region. In both basins, the cost per well is high.