Watchdog Urges House to Conclude Oil & Gas Law Revision

TEMPO.CO, Jakarta - Publish What You Pay (PWYP) Indonesia, a coalition for transparency and accountability of oil and gas, mining and natural resources management, urged Commission VII of the House of Representatives (DPR) to immediately deliberate the Oil and Gas Law revision. PWYP expected the DPR to draw up a revision plan before the end of its hearing period.

"Deliberation of Oil and Gas Law revision is imperative and urgent," PWYP Indonesia national coordinator Maryati Abdullah said in Jakarta on Monday, November 21, 2016. Oil and Gas Law revision has been listed in the House's National Legislative Programs (Prolegnas) since 2010.

Maryati said that Indonesia will be facing an energy crisis in 2025. Maryati predicted that Indonesia would need 7.4 million barrels of oil equivalent per day. Oil and gas account for 47 percent of the national energy resources, with a total number of energy consumption reaching up to 1.4 tons of oil equivalent per day.

Data from upstream oil and gas regulator SKK Migas showed that Indonesia’s oil production only stands at 250,000 barrels per day, some 86 percent of which are produced from old oil fields. "Current reserves are unable to meet demand," Maryati said.

Maryati added that oil and gas sector is currently dealing with mafia practices. The Corruption Eradication Commission (KPK) has found potential state loss of US$336.1 million, equals to Rp4.4 trillion due to failure of oil and gas contractors to pay their liabilities in terminated Working Areas.

The KPK has also found that 143 out of 319 Working Areas in the upstream oil and gas sector have not to fulfill their financial obligations, whereas as many as 141 Working Areas have failed to perform Environmental Based Assessment (EBA).

VINDRY FLORENTIN