Lately, there has been much discussion regarding the Masela Oil and Gas Working Area Block (WK) development scheme, located in the sea off Maluku. There is debate over which scheme is better between onshore and offshore. This article will discuss in general the comparison between the two schemes.

What is the meaning of onshore and offshore?

Onshore, translated from English, which means land that approaches the sea or is on land and not at sea1, refers to work related to buildings/structures located on land to the coastline for oil and gas exploration and exploitation activities. Examples of onshore works are onshore refineries and boreholes.

Figure 1 Example of an onshore project

Source: cbi.com

Figure 2 Drilling rig onshore

Source: yabiladi.com

Meanwhile, offshore, which means far from or far from the mainland, is an exploration and exploitation of oil and gas carried out offshore or far from the mainland. In offshore activities, exploration and exploitation are carried out using fixed offshore platforms (jacket, jack-up) or floating (Spar, TLP, FPSO, and others).

Figure 3 Jacket type offshore platform

Source: 2b1stconsulting.com dan fisheries.noaa.gov

Figure 4 Offshore FPSO type platform

Source: pinterest.com and wikipedia.org

What is the difference between Onshore and Offshore?

Onshore refineries are more accessible to reach than offshore refineries because the location of the refineries themselves can be in the middle of a forest, a mountain peak, in the middle of a desert, even on the edge of a city or village.1 The provisions needed to drill onshore wells are somewhat more accessible than offshore. However, because there has been a lot of exploration and exploitation on land, the chances of finding new oil and gas reserves are smaller than in the oceans.

Besides, the challenges for oil and gas exploration offshore are more significant than onshore. Onshore refinery construction projects must consider the strength of the ground for the foundation and wind loads, while at sea, other aspects need to be taken into account, namely the load arising from the movement of currents and ocean waves. It requires more complex human resources and expertise in designing the refinery.

Moreover, the operational costs required for offshore exploration are more expensive than onshore. From a development perspective, the structural materials used in offshore projects cannot be arbitrary. There need to be considerations related to marine environmental factors such as corrosion and failure caused by marine biota growth. However, the advantage of an offshore rig is that the structure can be moved because it uses floating platforms such as Floating Production Storage and Offloading (FPSO) and Tension Leg Platform (TLP) so that it can be reused for exploration in other locations after it has finished extracting oil and gas from the previous location.

The following is an example of a comparison regarding the above matters: the Masela Oil and Gas Working Area Block in Maluku

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Figure 4 Offshore FPSO type platform

Source: https://mediaindonesia.com/ekonomi/31471/blok-masela-utamakan-indonesia-timur

It should be noted that the Oil and Gas Working Area Block is located in the sea off Maluku. In the onshore scheme, oil and gas exploitation is carried out at sea using floating offshore platforms for the drilling process. The drilling results are then sent to the mainland using submarine pipes or tanker ships to be further processed into liquefied natural gas (LNG) so that the natural gas from the drilling can be sold and consumed. Apart from the need for offshore drilling facilities, in this scheme, because the wells are located in the high seas, LNG production facilities on land are also needed, and a piping system or sea-to-land transportation. Unlike the offshore scheme, which does not require production facilities on land, LNG production activities can be carried out on platforms or platforms. In the offshore scheme, natural gas from drilling is directly processed into LNG, sent ashore by tanker to be directly sold and consumed. However, the offshore scheme’s use requires a more complex offshore platform because LNG production must be carried out on a platform.

The following are some of the differences in the onshore and offshore schemes2:

Aspects Onshore Offshore
Infrastructure Offshore platforms (drilling), onshore production facilities, transportation systems (pipelines or tankers) Offshore platforms (drilling and production), transportation systems (tankers)
The land acquisition Unlimited Limited
The Land Conflict Possible, because the construction of facilities on land is necessary Low Possibility, due to activities on the high seas
Social and Environmental Effect Possible, due to land activity,, the environment can be polluted Less social impacts, the environment may be polluted
Facilities after the exploitation period is over Facilities on land are difficult to move, and can be used for LNG production from other wells The offshore platform can be moved to another exploitation location because it is floating
Maintenance It is easier and cheaper because of access on land It is more difficult and expensive because it located at the high sea

Distribution of oil and gas blocks that are managed offshore and onshore

In Indonesia, there have been many oil and gas exploitation activities in onshore and offshore schemes. The following is some data on the distribution of oil and gas blocks in Indonesia3 (SKK Migas report on January 1, 2020).

 

No Working Area Block/Location Operator Commodity Status
1 Region I (Sumatra, Riau Islands, dan Natuna Island) Bangko Petrochina Oil and Gas Onshore
2 Batanghari Gregory Gas Onshore
3 Belida Sele Raya Oil and Gas Onshore
4 Bentu EMP Gas Onshore
5 Aceh Blok A Medco Gas Onshore
6 CPP BOB – BSP dan Pertamina Oil Onshore
7 Corridor CONOCO PHILLIPS Gas Onshore
8 Duyung West Natuna Oil and Gas Offshore
9 Gebang EMP Oil and Gas Onshore and Offshore
10 Jabung Petrochina Oil and Gas Onshore
11 Jambi-Merang PHE Oil and Gas Onshore
12 Kakap Star Energy Oil and Gas Offshore
13 Kampar PHE Oil Onshore
14 Karang Agung ODIRA Oil and Gas Onshore
15 Kisaran Pacific Oil and Gas Onshore
16 Korinci Baru Kalila Gas Onshore
17 Krueng Mane ENI Oil and Gas Offshore
18 Langgak SPR Oil Onshore
19 Lemang Mandala Energy Oil and Gas Onshore
20 Lematang Medco Oil and Gas Onshore
21 Lhokseumawe Zaratex Gas Onshore and Offshore
22 Mahato Texcal Oil Onshore
23 Selat Malaka EMP Oil and Gas Onshore and Offshore
24 Merangin II Sele Raya Oil and Gas Onshore
25 Laut Natuna Blok A Premier Gas Offshore
26 Sumatra Utara Blok B PHE Oil and Gas Onshore
27 Sumatra Utara Offshore PHE Oil and Gas Offshore
28 North West Natuna AWE Gas Offshore
29 Ogan Komering PHE Oil and Gas Onshore
30 Palmerah Tately Oil and Gas Onshore
31 Pandan Tropik Oil and Gas Onshore
32 Raja and Pendopo PHE Oil and Gas Onshore
33 Rimau Medco Oil and Gas Onshore
34 Rokan Chevron Oil and Gas Onshore
35 Selat Panjang SGE Oil and Gas Onshore
36 Sembilang Mandiri Panca Usaha Oil and Gas Onshore
37 Siak PHE Oil Onshore
38 South Jambi Jindi Oil and Gas Onshore
39 South Natuna Sea Medco Oil and Gas Offshore
40 South Sumatra Medco Oil and Gas Onshore
41 Bukit Barisan Southwest Rizki Gas Onshore
42 Tonga EMP Oil and Gas Onshore
43 Tungkal MontD’Or Oil Onshore
44 Air Komering Barat Tiarabumi Oil and Gas Onshore
45 Region II (Jawa dan Kalimantan) Alas Dara Kemuning Pertamina Oil and Gas Onshore
46 Bangkanai Medco Oil and Gas Onshore
47 Bawean Camar Oil Onshore dan Offshore
48 Bengara I Medco Oil and Gas Onshore and Offshore
49 Brantas Minarak Gas Onshore
50 Bulu Kris Energy Gas Offshore
51 Cepu Exxon Mobil Oil Onshore
52 Kangean Kangean Energy Gas Onshore and Offshore
53 Ketapang Petronas Oil Offshore
54 Madura Offshore Ophir Gas Offshore
55 Selat Madura Husky-CNOOC Oil and Gas Offshore
56 Muriah Petronas Gas Offshore
57 Nunukan PHE Oil Offshore
58 ONWJ PHE Oil and Gas Offshore
59 Pangkah Saka Gas Offshore
60 Pasir Pasir Oil and Gas Onshore
61 Randugunting PHE Gas Onshore and Offshore
62 Sanga-Sanga PHE Oil and Gas Onshore
63 Simenggaris JOB Medco Oil and Gas Onshore
64 Southeast Sumatra PHE Oil and Gas Offshore
65 Tarakan Medco Oil and Gas Onshore
66 Tuban PHE Oil and Gas Offshore
67 Wailawi Benuo Taka Oil and Gas Onshore
68 Wain Pandawa Oil and Gas Onshore
69 West Madura Offshore PHE Oil and Gas Offshore
70 Region III (East Indonesia) Berau BP Oil and Gas Offshore
71 Bontang StarBorn Oil Offshore
72 Bula Kalrez Oil Onshore
73 East Kalimantan and Attaka PHKT Oil and Gas Onshore and Offshore
74 East Sepinggan ENI Gas Offshore
75 Ganal Chevron Oil and Gas Offshore
76 Kasuri Genting Oil and Gas Onshore dan Offshore
77 Kepala Burung Petrogas Oil and Gas Onshore
78 Mahakam PHM Oil and Gas Onshore dan Offshore
79 Selat Makassar Chevron Oil and Gas Offshore
80 Masela Inpex Gas Offshore
81 Muara Bakau ENI Gas Offshore
82 Muturi BP Gas Onshore dan Offshore
83 Rapak Chevron Oil and Gas Offshore
84 Salawati Petrogas Oil and Gas Onshore and Offshore
85 Sebuku Pearl Gas Onshore and Offshore
86 Sengkang Energy Equity Gas Onshore
87 Senoro-Toili JOB Medco Gas Onshore and Offshore
88 Seram Non Bula CITIC Minyak Offshore
89 Tarakan Offshore Manhattan Oil and Gas Offshore
90 West Salawati MontD’Or Oil and Gas Onshore and Offshore
91 Wiriagar BP Gas Onshore

By Hadian Bagas Widyawan and Kevin Alief Adityaputra

  1. Walter, E., 2008. Cambridge advanced learner’s dictionary. Cambridge university press.
  2. Annisa Ayu Artanti, 2016. Kelebihan dan Kekurangan Fasilitas Offshore atau Onshore Blok Masela. https://www.medcom.id/ekonomi/energi/1bV0OgaK-kelebihan-dan-kekurangan-fasilitas-offshore-atau-onshore-blok-masela (diakses 02/02/2021)Annisa Ayu Artanti, 2016. Kelebihan dan Kekurangan Fasilitas Offshore atau Onshore Blok Masela. https://www.medcom.id/ekonomi/energi/1bV0OgaK-kelebihan-dan-kekurangan-fasilitas-offshore-atau-onshore-blok-masela (diakses 02/02/2021)
  3. Badaruddin, M., 2018. Dinamika Industri Migas dan Pertambangan di Indonesia. Jakarta: Jurusan Ilmu Poilitik, Universitas Bakrie