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SKK Migas, Association Agree to Use Local Steel, Reduce Imports
A worker observe steel production process in a factory owned by Krakatau Steel in Cilegon. TEMPO/Tony Hartawan
Friday, 09 November, 2018 | 14:22 WIB
SKK Migas, Association Agree to Use Local Steel, Reduce Imports

TEMPO.CO, Jakarta - The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) and the Indonesian Iron and Steel Industry Association (IISIA) agreed to boost the domestic use of iron and steel in the upstream oil and gas industry. At present, only 70 percent of the domestic product is absorbed by the upstream oil and gas industry. The rest is imported.

"We need long terms, if we want it to be easy, we can just import it," SKK Migas chief Amien Sunaryadi said after signing the agreement in Jakarta, Friday, November 9.

The SKK Migas will provide a list and amount of steel needed by the upstream industry. Then, producers who are members of IISIA will provide reasonable price quotations to the SKK Migas.

After the SKK obtained a list of prices from the association, they will carry out audits to ensure that the iron and steel sales prices are valid. Then, contractors throughout Indonesia will be asked to use it.

There are a number of producers involved, including Krakatau Steel, Bakrie Pipe Industries, and KHI Pipe Industries.

The association's chairman, Silmy Karim, ensures that member producers will try to meet the iron and steel specifications needed by the contractors. He hopes that a steel and iron import moratorium can be implemented to help achieve this goal.

"Steel is the mother of industries, we want to nourish the national steel industry, not the national import industry," he said.

Fajar Pebrianto

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