Oil turmoil not a worry for this Indonesian tycoon

The rout in oil prices may be in its sixth month, but Indonesian business magnate Kris Wiluan isn't worried that the turmoil will hurt demand for his firm's oil exploration and production services.

"For my 30 years [in the sector], I've experienced prices going up and down. As long as there is demand, you can never replace hydrocarbon," said the chairman of mega-conglomerate Citramas Group, referring to the chain molecules found in crude oil.

Global oil prices have been in free-fall since June on a host of concerns including weak demand, a strong U.S. dollar and booming U.S. oil production contributing to a supply glut. The Organization of the Petroleum Exporting Countries' (OPEC) decision in November to reduce output added to the gloom.

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U.S. crude closed at $48.79 per barrel in U.S. trade on Thursday, down sharply from a nine-month high above $107 a barrel touched in June. This week, Benchmark Brent crude fell through the $50-a-barrel mark to its lowest price level since May 2009, before recovering to settle at $51 a barrel. Since June, it has lost more than 55 percent.

Cheaper oil means trouble for refiners and oil rig builders. The decline in drilling activity also translates into less business for companies that provide drilling services or manufacture related equipment.

However, diversification will help Batam-based Citramas – which derives nearly 50 percent of its revenue from the oil and gas sector – to tide through the turmoil.

"We supply services for drilling [and] in terms of rig building, we don't have a big fleet – about 11 rigs. So we are niche in the market," said Wiluan, who founded the company in 1976. "You can feel the wind but that's a normal experience I've gone through over the past years."

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Opportunities and headwinds

From its origins as a logistics provider, Citramas has become a sprawling business empire, with interests in the oilfield equipment manufacturing, shipping, property, hospitality and leisure, and media sectors. In 2010, the firm took another gamble by going up the value chain – fabricating oil rigs and providing drilling services for the oil and gas industry worldwide.

But for Wiluan – ranked as Indonesia's 35th richest man by Forbes magazine in 2007, with a personal net worth of $185 million – the company's expansion won't stop there.

The 66-year-old told CNBC's "Managing Asia" that he hopes to start producing offshore rigs by 2016.

"I have a dream and I hope it won't take too long... I want to keep going up the value chain [and] work with offshore rigs. But that will cost $200 million each, compared to a land rig which costs $30 million. It will be a big jump, so I have to be careful," he said.

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Geographically, the Indonesian tycoon could expand drilling activity in West Africa, Middle East, China, and even America, which has seen a shale gas revolution.

"I'm very interested in the technology that has helped the U.S. to suddenly become an exporter of energy, from a big energy importer. I hope to participate more." Wiluan, who also heads Singapore-listed KS Energy Services and Jakarta-listed Citra Tubindo, said.

But his main focus will lie closer to home. Apart from Vietnam and Australia, Wiluan is bullish on the potential that Indonesia offers in terms of gas exploration, though a lack of infrastructure is an issue.

"They will need to build a lot of terminals, gas terminals, gas lines, pipelines. [But apart from gas,] we have a lot of alternative geothermal energy and that has not been exploited yet. So there's a lot of potential for Indonesia," he added.