Project Investment Analysis: Case Study of Installation Additional Offloading Pump at B-Field to Recover Oil Production

Oil and gas production in Indonesia keeps declining while consumption increases, resulting being a net oil importer since 2004. The problem that is faced by many producers right now the mature field with an aging facility frequent unplanned shutdowns could jeopardize production. If not responded to promptly adequately, lose its This one of challenges PT ABC are facing. study will present investment project analysis procure additional permanent offloading pumps at Field-B help revitalize after shutdown. pump intended speed up wells' potential recovery minimize loss shutting down. Two scenarios evaluated for pump: buy case or lease case. performed exercising business situation then using discounted cash flow (DCF) method financial feasibility. From PESTEL external VRIO internal analysis, both analyses suggest aspects support having pump. DCF Production Sharing Contract (PSC) scheme applied ABC. For case, Net Present Value (NPV) 0.89 million $ Monte Carlo Simulation showing possibility negative NPV 7%. 2.32 0%. Based on parameter then, it suggested management invest option, which shows better NPV.