The concessions of Idi–Langsa
Fifteen concession territories, together measuring 8,652 hectares, had been brought into exploitation in the sub-district of Idi Langsa. Two of them, Peudawa and Paja-Bilik, were no longer worked. Of the remainder, East Peudawa and Peureula — the latter a concession of the Perlak Petroleum Company — were exploited by the Batavian Petroleum Company, while South Peureula was worked by the Petroleum Company of South Perlak. The licence territory of Kroeng Meureubo, also held by the “Batavian,” came into production for the first time in 1914, yielding 17 K.G. tons of crude oil that year.
The Pangkalan Brandan refinery
All the oil from these territories was delivered to and processed by the Batavian Petroleum Company’s refinery at Pangkalan Brandan on the East Coast of Sumatra, to which it was carried from the drilling fields by a pipeline of some 120 kilometres — a 5-inch oil line of 800 tons’ hourly capacity and a 4-inch gas line of up to 100 tons. At Pangkalan Brandan the Atjehnese crude was refined into petrol (benzine), kerosene, diesel oil, residue and a little asphalt; petrol output, for example, fell from 66,253 K.G. tons in 1913 to 44,144 in 1915, and kerosene from 92,895 to 65,079 over the same span.
Declining output
Production continued the decline that had set in after 1913. Across the three working fields the totals fell from 182,447 K.G. tons in 1913 to 148,493 in 1914 and 125,733 in 1915. The fall was sharpest at East Peudawa, which collapsed from 1,609 K.G. tons in 1913 to 220 in 1915; Peureula, much the largest field, slipped from 164,100 to 114,045 K.G. tons, and South Peureula from 16,738 to 11,468 over the same years.
Exploration and prospecting
Beyond the producing fields, nine mining-investigation licences were still in force in 1914. On the territory of Batoe Bedoelang in Tamiang the Colonial Petroleum Company began deep drilling in 1913 but abandoned it at a depth of 405 metres. The Company for Mining, Forestry and Agricultural Exploitation prepared an investigation at Simpang Olim near Idi, and further explorations were carried out in the oeleëbalangschap of Meurasa near Oelèë Lheuë, at Soengei Raja and at Bajeuën. The presence of crude oil had also been established outside the worked areas, among other places at Peusangan, though the definitive results of these surveys were not yet known.
Significance
The petroleum fields of Idi Langsa made Acheh a contributor to the wider Sumatran oil economy that the Batavian Petroleum Company built around Pangkalan Brandan, and their hoped-for expansion was one of the developments that might one day furnish a hinterland for Sabang. Yet the declining yields of the 1910s showed the Atjehnese fields to be ageing even as colonial enterprise in the region was at its most confident.
Account from The Geology of Indonesia (1949) — Oil exploration in North Sumatra
The 1883 Zulkler concession and the 1885 Telaga Said drilling
The founding episode of the northern-Sumatran oil industry is the 1883 oil concession granted to the private entrepreneur J. Zulkler. Van Bemmelen’s account reads:
“In 1883 a concession for oil had been granted in North Sumatra. The concessionary, J. ZulkER, met with considerable difficulties in drilling on account of an abundant flow of gas and asked the Government Bureau of Mines for assistance. A government crew, under the leadership of the mining engineer FENNEMA, was sent with drilling equipment and shortly afterwards, in 1885, this oil venture proved to be an outstanding success.”
The episode is significant on three counts. First, it is the first documented oil concession in northern Sumatra, and accordingly the founding legal episode of the northern-Sumatran oil industry. Second, the technical difficulty that Zulkler encountered — “an abundant flow of gas” — is the first recorded encounter with the high-pressure gas zones that would become a recurrent feature of northern-Sumatran drilling. Third, the fact that Zulkler had to ask the Government Bureau of Mines for technical assistance is the first documented instance of the public-private partnership model that would subsequently characterise the entire East Indian oil industry: private concessionaries held the legal rights, but the government supplied the geological expertise and (in the early years) the drilling equipment.
The 1890 founding of Royal Dutch
The success of the Telaga Said drilling attracted further private investment, and in 1890 the concession became the first oil property of the newly founded Koninklijke Maatschappij tot ontginning van Petroleum terreinen in Nederlandsch Indië (“Royal Company for the exploitation of oil fields in the Netherlands East Indies”) — the future Royal Dutch. The 1890 founding of the Koninklijke Maatschappij accordingly represents the consolidation of the northern-Sumatran oil industry under a single corporate umbrella, and the beginning of the corporate sequence that would lead, via the 1907 amalgamation with Shell, to the creation of the B.P.M. as the dominant East Indian oil company.
The 1907 amalgamation and the creation of the B.P.M.
The 1907 amalgamation of Royal Dutch with the Shell Transport and Trading Company created the Royal Dutch Shell group, and the B.P.M. (Bataafsche Petroleum Maatschappij) was created as the Royal Dutch subsidiary for the East Indian oil interests. The B.P.M. subsequently took over “all interests of the Royal Dutch in the Indian Archipelago”, and the B.P.M.’s dominance of the East Indian oil industry (57.3 % of crude production in 1940) made it the principal corporate actor in the colonial mineral economy of which Atjeh was a part.
The 1912 entry of Standard Oil of New Jersey
The 1912 entry of the Standard Oil Company of New Jersey — through its subsidiary the N.K.P.M. (Nederlandsche Koloniale Petroleum Maatschappij) — marked the first significant American participation in the East Indian oil industry. The N.K.P.M. subsequently grew to “about one fourth of the total crude output” by 1940, making it the second-largest oil company in the East Indies, after the B.P.M. For Atjeh specifically, the N.K.P.M. was the operator of the Pulu Pandjang field in the Atjeh oil complex — the only Atjeh-complex field operated by the company.
The 1931 entry of Standard Oil of California
The 1931 entry of the Standard Oil Company of California — through its subsidiary the N.P.P.M. (Nederlandsche Pacific Petroleum Maatschappij) — marked the second significant American participation in the East Indian oil industry. For Atjeh specifically, the N.P.P.M. was the operator of the Pasé field in the Atjeh oil complex — the only Atjeh-complex field brought into production in 1941 (i.e. the newest of the Atjeh-complex fields).
The 1940–1941 production tables
By the 1940–1941 period, the North Sumatra oil province — as recorded in Van Bemmelen’s Table 4 — comprised the following producing fields:
| Field | Operator | 1940 | 1941 |
|---|---|---|---|
| Aru Bay | B.P.M. | 55,924 | 55,070 |
| Telaga Said | B.P.M. | 1,076 | 960 |
| Bulu Telang | B.P.M. | 919 | 900 |
| [[East Atjeh oil block | East Atjeh (block)]] | B.P.M. | — |
| [[Tamiang oil block | Tamiang (block)]] | B.P.M. | 709,625 |
| S. Aru Bay (block) | B.P.M. | 2,100 | 5,030 |
| Peureula (Atjeh complex) | N.L.A.M. | 48,219 | 36,640 |
| South Perlak (Atjeh complex) | N.L.A.M. | — | — |
| Pulu Pandjang (Atjeh complex) | N.K.P.M. | — | — |
| [[Pasé oil field | Pasé]] (Atjeh complex) | N.P.P.M. | — |
| Rokan block | N.P.P.M. | — | 1,402 |
| Total North Sumatra | — | 920,755 | 728,682 |
The total North-Sumatran production of 920,755 tons in 1940 and 728,682 tons in 1941 represents the high-point of the colonial northern-Sumatran oil industry, and the B.P.M.’s share of this production (769,644 tons in 1940, 83.7 % of the total) reflects the company’s overwhelming dominance of the North-Sumatran oil province.
The deepest exploratory drilling: Lho Sukon, 3,450 m
The North-Sumatran oil exploration also set the depth-record for the colonial East Indian petroleum industry: the deepest exploratory drilling was made at Lho Sukon in Atjeh, reaching a depth of 3,450 m. The Lho Sukon drilling is the technical high-point of the colonial oil-prospecting activity on Atjeh territory, and it accordingly marks the high-point of the colonial state’s investment in the exploration of the Atjeh-interior petroleum geology.
Significance
The oil exploration in North Sumatra is significant for the encyclopedia of Acheh history because it is the principal mineral-economic link between colonial Atjeh and the world petroleum economy in the first half of the twentieth century. The 1883 Zulkler concession and the 1885 Fennema-led Telaga Said drilling are the founding episodes of the northern-Sumatran oil industry, and the subsequent extension of the industry onto Atjeh territory — the East Atjeh, Tamiang and Atjeh oil complex fields — is the central fact of Atjeh’s colonial oil economy. The B.P.M.’s dominance of the North-Sumatran oil province, and the N.K.P.M.’s and N.P.P.M.’s secondary presence in the Atjeh oil complex, are the corporate facts of Atjeh’s colonial oil economy, and the 1940–1941 production tables are the quantitative record of that economy’s high-point.
Account from Vijftig jaren economische staatkunde in Atjeh (1923)
In author Joh. Langhout’s chapter “De Petroleum-ontginning” (“The petroleum-exploitation”), the industry was one of the first to establish itself in the still un-pacified Atjeh — and, against the popular legend “dat de militaire excursies vaak slechts moesten dienen om dekking te verleenen aan de nieuw gevestigde ondernemingen” (“that the military excursions often merely served to give cover to the newly established enterprises”), it was itself “one of the foremost factors of the pacification of this part of the coast tract”.
From dug wells to company
The industry’s roots lay in the landscape Peureula on the East Coast, where petroleum springs had been worked “in native fashion” for centuries: from of old an “Indische markt” (Indian market) existed there, where the oil won from four dug wells was brought to market — the source of the petroleum which the East India Company in the eighteenth century sometimes obtained from the Sultan of Atjeh and which was highly prized in the mother-country as a medicament. Already in 1890, even south of the provincial border in the Langkat country, the Bataafsche had founded her establishment Pangkalan Brandan; an establishment at the deep-water Aroe-baai was then impossible for the absence of every authority, Dutch or native, the coast lying in complete anarchy and the young establishment being repeatedly startled by attacks of roving bands. A few years later the Hollandsche Perlak Maatschappij (the later Perlak Petroleum-Mij) began her activity on actual Atjehnese ground, at Peureula.
The pacifying enterprise
On the estates the Atjehnese for the first time knew the Hollander otherwise than as a soldier: there he found work and an ample earning, while to the chiefs and great ones the enterprise opened a source of income in the cijns (tribute) greater than they had ever drawn from the heaviest taxing of their subjects. The tact and language-knowledge of the administrator Allein reconciled the surrounding population to the point that within a short time he worked with 60% Atjehnese voluntary labour, and many of the later employees of the Atjeh Tram received their first schooling on the Perlak enterprise. After a few raids by strange mountain bands in the first years, the enterprise’s good name became known even to the “kwaadwilligen” (“evilly-disposed”): once, upon a foray in which all rice was carried off from the native and Chinese settlement, the enterprise’s full rice-barns — past which the bands had crossed the river — were left unmolested. The successive governors of Atjeh therefore always favoured the petroleum enterprises, and — in deviation from custom — a geologist or other officer was occasionally allowed to accompany an excursion into the interior in search of oil-traces: “de vestiging van den olieman, zoo wisten de militairen, beteekent… de vrede!” (“the settlement of the oil-man, the soldiers knew, means… peace!”).
Extensions and consolidation
Governor Van Heutsz gave European mining his full interest, opening several tracts for private investigation and exploitation: especially in Peureula were great and rich petroleum wells struck, and in 1902–1903 also at Langsar, Peudada, Idi, Djoelo Rajeu and Tjoenda. In 1899 the Koninklijke Petroleum Maatschappij had founded enterprises at Lho Seumawè and Peureula. Governor Swart’s government explored for petroleum in Peusangan without exploitation following; the province’s mineral concessions were not extended — “hetwelk te betreuren viel” (“which was to be deplored”) — the foremost concession remaining that of Zuid Perlak, exploited “by de Koninklijke”. Some years before 1923 the Zuid Perlak Maatschappij transferred its works to the Bataafsche Petroleum Maatschappij, which already exploited other Perlak terrains.
Rantau Pandjang and the pipeline
“In het binnenland is gaandeweg een oliestad, Rantau Pandjang, ontstaan” — in the interior the oil city Rantau Pandjang gradually arose: the oil was won there and, by a kilometres-long pipeline, pumped to Pangkalan Brandan, the industrial city of the Langkat terrains. Rantau Pandjang had a brilliantly equipped enterprise, surrounded by oil wells, in which — beside a number of European workmen — a very great number of native and Chinese workers found an ample existence. According to the official data, the Bataafsche pumped in December 1922 from the tract Peureula “121197 ton” (as printed; probably 121,197 ton) of crude oil, while in the same month 598 tons were pumped from the oil field at Aloer Mas toward Rantau Pandjang — figures which over the last years showed a steady increase. (For the company histories see Bataafsche Petroleum Maatschappij, Perlak Petroleum-Mij, Zuid-Perlak Petroleum-Mij and Koninklijke Petroleum Maatschappij.)
See Also
Source
De Europeesche Industrie [“The European Industry”], section De Buitenbezittingen (“The Outer Possessions”), in Grooten van Zee en Land in Nederlandsch-Indië, Vol. 6, pp. 248–249 (English translation from the Dutch).
The Geology of Indonesia, by R. W. van Bemmelen, Vol. II: Economic Geology (The Hague: Government Printing Office; Martinus Nijhoff, 1949), pp. 7–11 (petroleum history, situation before WWII, oil districts of the East Indies).
Vijftig jaren economische staatkunde in Atjeh, by Joh. Langhout (The Hague: N.V. Boekhandel v/h W. P. van Stockum & Zoon, 1923), pp. 68, 83–85, 108, 160–163 (chapter “De Petroleum-ontginning”), illustration captions pp. 160, 162.