Oil production remains flat around 2.5 mb/d by 2020, but then steadily declines to
1.6 mb/d in 2040. Although their oil output flattens, Indonesia and Malaysia remain
the dominant producers in the region; their combined share increases slightly to
almost two-thirds of the total. The outlook for Southeast Asia’s oil production will
depend on the ability of the region’s major resource holders to incentivise
investment in under-explored areas and to deploy advanced production
technologies to slow the decline in key fields.
• Natural gas production in Southeast Asia grows from 214 bcm in 2013 to around
260 bcm in 2040, led almost entirely by Indonesia and expanded output in
Myanmar. The increase in gas output principally meets rising domestic consumption,
driven by the development of LNG infrastructure that enables the exploitation of
stranded resources and their delivery to regional demand centres.
• Indonesia remains a cornerstone in global coal markets. Coal production increases
by more than 50%, reaching over 600 Mtce in 2040. Indonesia cedes its status as the
world’s largest coal exporter before 2020 to Australia, as domestic demand surges
and coal demand growth on international markets slows.
• The outlook for fossil-fuel production in Southeast Asia varies by fuel and by
country, hinging on their individual resource endowments, and remains subject to a
number of uncertainties. The ability to attract private and foreign investment, to
improve fiscal and regulatory frameworks and to push reforms in fossil-fuel
subsidies will be critical to the development of Southeast Asia’s energy supply.
• The projected trends in energy demand and supply in Southeast Asia imply that the
region is set to increasingly rely on oil and gas imports. By 2040, net oil imports
more than double to 6.7 mb/d, while the reliance on imported oil products declines
as the region’s refinery capacity expands by 2.6 mb/d and its utilisation rates
increase. Due to rapid growth in domestic consumption, Southeast Asia surrenders
its role as a major gas supplier to international markets, becoming a net gas
importer of around 10 bcm in 2040. As a result, the net oil and gas import bill more
than triples to about $320 billion in 2040.