KATADATA ?
Indonesian government needs to take steps to improve the investment climate and convince investors to invest their fund in oil and gas sector. Otherwise, the country will never solve its oil and gas output issue that has consistently missed its target.
Executive Director of Indonesian Petroleum Association (IPA) Dipnala Tamzil said that there are many ways the government can do to increase the country?s oil and gas output. One of them is to remove all barriers hampering exploration and production activities.
The government needs to launch a regulatory reform in addition to providing incentives. It also needs to simplify its bureaucratic and permitting procedures.
Permitting procedures are one of the primary concerns of investors. According to a study conducted by Katadata, the process for obtaining a license in the upstream oil and gas sector will require investors to visit 17 different institutions from national to local level to obtain 341 permits. If printed, the paperwork for oil and gas permit may reach 600,000 pages in length.
According to him, business actors need certainty to ensure their business continuity. The problem is there is no legal umbrella to regulate the issue. He expects the government to issue a regulation on contract extension for Profit Sharing Contractor (PSC).
IPA also asks the government to stop the criminalization of oil and gas industry. An example of this is the bioremediation case involving two Chevron's employees. In addition, the government needs to solve land-related conflict between the local government and local community.
(Read: 23 Oil and Gas Contractors Involve in Tax Dispute Worth IDR3.2 Trillion)
He is confident that if the government is able to solve those problems, the investment climate in oil and gas sector will improve and become more conducive so that the investors are able increase its exploration activities. "It will eventually increase the national oil and gas output," he said to Katadata, on Wednesday (3/25).
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