Indonesia’s Pertamina and Sinopec, a Chinese oil and gas company, have signed a memorandum of understanding (MOU) to accelerate the growth of their renewable energy profiles and to strengthen energy transition commitment.
The MOU was signed by Pertamina’s President Director and CEO Nicke Widyawati and Sinopec Group Chairman Ma Yongsheng in Shanghai. The pact aims to strengthen research and development and business development in unconventional hydrocarbons, carbon capture utilisation and storage (CCUS), enhanced oil recovery, and ultradeep drilling.
The partnership will also focus on renewables such as geothermal energy, hydrogen, and solar power. The MOU builds on a previous agreement between Pertamina subsidiary, Pertamina Hulu Energi, and Sinopec’s upstream business, according to a press note.
Pertamina’s CEO, Nicke Widyawati said that Indonesia faces challenges in achieving energy security, given its increasing energy demand, continued dependence on fossil fuels, and declining oil production.
“Energy security is a top priority for Indonesia, so we need to reduce dependence on imports by diversifying the energy mix, optimizing local energy resources while expanding access to cleaner energy sources,” Widyawati stated.
“Indonesia is a strategic pathway for the global supply chain in energy transition, rich in renewable energy sources and essential materials needed for energy transition such as nickel, bauxite, and copper, including the potential for nature-based solutions and CCUS,” she said.
“Pertamina has developed a comprehensive strategic initiative covering decarbonisation of operations, establishing low-carbon emission businesses, and implementing carbon reduction programs. Our strong support for NZE involves transforming the way we do business and manage company operations to prioritize sustainability,” said Widyawati.
However, she noted that Indonesia has issues accessing financing including early-stage funding and that the country also needs to invest in its human capital.
“Therefore, to truly succeed in this energy transition, we recognize the importance of appropriate support and encouragement through strategic partnerships,” she said.