Medco Remains Aggressive in Oil and Gas Sector, Here's Why

PT Medco Energi International Tbk (MEDC) will still aggressively expand in both acquisition and exploration of oil and gas blocks, while large oil and gas companies are starting to shift their focus from fossil energy to renewable energy. Medco Energi President Director Hilmi Panigoro said Indonesia still needs large oil production. "Today we need around 1.6 million barrels of oil per day (bpod), and it is still growing, while the national oil and gas production is only 700,000 bpod," he said.

According to him, Medco Energi has run active and disciplined portfolio management in the financial sector for its oil and gas development. This year, the MEDC stock-coded company has set an oil and gas production target of 100-105 barrels of oil equivalent per day (boepd), with a gas share reaching 60 percent. The company also performs cost-efficient operations, as low as US$10 per boe. Besides, Medco Energi will carry out low-risk exploration and focus on their production assets.

Hilmi said MEDC would continue to expand organically with exploration and inorganically with acquisitions. "The rule of thumb is, we will spend more cash for exploration if the oil price is rising. If the price decreases, there are lots of goods at reasonable prices, we will have many acquisitions," he said.