The average domestic oil and gas production cost is US$15.5 per barrel of oil equivalent (BOE). However, the production costs of several Contractor Contract of Work (CCW) participants significantly exceed this figure.
Based on FME data as of July 31, 2017, Kangean Energy Indonesia (KEI) had the highest oil and gas production cost among CCWs, reaching US$31.25 per BOE. PHE ONWJ followed in second place at US$28.49 per BOE, and Medco Natuna was third at US$23.11 per BOE. BP Tangguh had the lowest production cost, at only US$1.86 per BOE.
The high oil and gas production costs of these CCWs indicate inefficient exploration and exploitation of oil and gas fields. Conversely, lower oil and gas production costs indicate greater efficiency in the exploration of oil and gas fields for each CCW. Generally, the more difficult the exploration of an oil and gas field, the higher the production cost.
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