The topography of the municipality of Balikpapan is generally hilly (85%), with only small areas of flatland (15%), particularly along the coast and surrounding the hilly areas. The hills are less than 100 meters higher than the adjacent valleys. The altitude of Balikpapan ranges from 0 to 80 meters above sea level.
Most of the soil in Balikpapan contains yellow-reddish podsolic soil and alluvial and quartz sand, making it extremely prone to erosion.
Prior to the oil boom of the early 1900s, Balikpapan was an isolated Bugis fishing village. Balikpapan’s name (lit. balik is behind and papan is a plank) comes from a folk story where a local king threw his newborn daughter into the sea to protect her from his enemies. The baby was tied beneath some planks, which were discovered by a fisherman.
In 1897, a small refinery company began the first oil drilling. Construction of roads, wharves, warehouses, offices, barracks, and bungalows started when a Dutch oil company arrived in the area. On January 24, 1942, Balikpapan became a war theatre between the Japanese army and the Allied Forces, resulting in heavy damage to the oil refinery and other facilities. Several campaigns followed until the 1945 Battle of Balikpapan, which concluded the Allied Forces’ Borneo campaign, after which they took control of the Borneo island.
Extensive wartime damage curtailed almost all oil production in the area until major repairs were performed by the Royal Dutch Shell company. Shell continued operating in the area until Indonesian state-owned Pertamina took it over in 1965. Lacking technology, skilled manpower, and capital to explore the petroleum region, Pertamina sublet petroleum concession contracts to multinational companies in the 1970s.
With the only oil refinery site in the region, Balikpapan emerged as a revitalized center of petroleum production. Pertamina opened its regional headquarters in the city, followed by branch offices established by international oil companies. Hundreds of labourers from other parts of Indonesia, along with skilled expatriates who served as managers and engineers, flocked into the city.
Balikpapan is bordered by the following:
Kutai Kartanagara Regency (in the North)
Makassar Strait (in the South and East)
Penajam Paser Utara Regency (in the West)
During the Suharto administration, Indonesia achieved unprecedented economic growth by promoting foreign investments, particularly in the exploitation of natural and mineral resources. Although the policy was heavily criticized for uncontrolled environmental damage and corrupt bureaucrats and politicians, it significantly boosted urban development in resource-rich cities. In the 1970s, Balikpapan experienced 7% population growth annually, while exports of timber and petroleum increased dramatically
Some multinational corporations conduct business activities in East Kalimantan province. Such companies as Pertamina (Indonesia), Total S.A. (France), ChevronTexaco (US), Schlumberger (France), BakerHughes (US), Weatherford (US), THIESS (Australia), and Halliburton (US) use Balikpapan as their base of operations in the region. Governmental public services also attract many people to work in this area, with presence of Bank Indonesia, Finance Department, Port of Semayang, and several others.
Balikpapan I consists of two raw oil refinery units that produce naphtha, kerosene, gasoline, diesel fuel, and residue and one high-vacuum unit that produces 100 tonnes (approx 98 tons) of paraffin oil distillate (POD), used as raw material for wax factories. The wax itself has various grades and is sold domestically and internationally.
Opened on November 1, 1983, Balikpapan II has a hydro-skimming and hydro-cracking refinery and produces petrol, LPG, naphtha, kerosene, and diesel fuel.
Balikpapan has the largest airport on the island of Borneo, the Sepinggan International Airport. It is also the busiest airport in Kalimantan and permits large aircraft.
Airlines currently using the airport are Lion Air, Merpati Nusantara Airlines, Batavia Air, Trigana Air, Kartika Airlines, and Sriwijaya Air (domestic routes), and Garuda Indonesia, AirAsia, and Silk Air (international routes).
The airport is one of the nine principal locations in Indonesia used by Muslims on their pilgrimage to Mecca, the “Hajj”. From 1996 to 1997, the airport served over 4,500 East Kalimantan pilgrims, and from 1997 to 1998, it served pilgrims from East Kalimantan, South Kalimantan, Central Sulawesi, and North Sulawesi.
In addition to the airport, Balikpapan also has a seaport called Semayang. It serves commercial boats to many destinations in Indonesia, such as Surabaya, Makassar, Jakarta, Pare Pare, and Manado. In the 1990s, transportation using ships was very popular. Today, due to more affordable and efficient airplane travel, more people choose to fly.
Taking the ferry is an alternative for traveling to other coastal areas in East Kalimantan, such as Penajam.