JAKARTA (RambuEnergy.com) – The Indonesian government is determined to continue to streamline business process and investment procedures in order to lure more investment in the country’s oil and gas industry, President Joko Widodo said.
Speaking at the opening ceremony of the 42nd Indonesia Petroleum Association, President Widodo admitted that the country’s regulatory environment is still not conducive in the eyes of investors.
“There are still many procedures that need to be trimmed down. I want to know which regulations still give you headaches. Just reported to the minister or to me directly,” said President Widodo when delivering a speech before the country’s oil and gas players.
As part of efforts to streamline business permits and investment, the Joko Widodo government expects to launch the so-called online single submission (OSS) system that will integrate all investment procedures from the central government to local government. Through this online system, the government and business players can trace the status of the business and investment permits and procedures.
Meanwhile, Ronald Gunawan, the President of the Indonesia Petroleum Association, said at the opening ceremony that the oil and gas industry players appreciate the government’s push to streamline rules and regulations in upstream oil and gas.
Moving forward, Ronald Gunawan said the industry expects that other ministries and government agencies, as well as regional governments, will also streamline rules and regulations related to upstream oil and gas industry.
The 42nd Indonesia Petroleum Association Convention and Exhibition kicked off today (May 2), carrying the theme “Driving Indonesia Oil and Gas Global Competitiveness”.
The theme is relevant given Indonesia’s diminishing oil output while global industry majors are becoming more selective in deciding where to invest. Domestically, industry players are also adapting the new gross split scheme.
“The switch from PSC Cost Recovery to Gross Split is a significant change, which aimed at giving contractors greater flexibility for operating efficiency,” said Ronald Gunawan, adding the gross split scheme had started to garner positive results, as seen in five exploration contracts awarded in oil and gas auctions in 2017.
The government is ready to improve the gross split further in order to attract more investors.
“I want this forum to speak openly on which regulations still create complications. If not to the (Energy and Mineral Resources) Minister then straight to me. This also includes the gross split scheme, which part still needs to be fixed or improved,” the President said.
The President said oil and gas industry would continue to play an important role in the energy security agenda for the foreseeable future, despite the increasing presence of new technological advancements such as electric vehicles.
Echoing the President’s remarks, Ronald Gunawan said the National Energy Blueprint stipulates that oil and gas would still account for 44% of national energy consumption by 2050. “From this, we can conclude that oil and gas would remain a backbone to the national energy (agenda) for the next 20-30 years,” he added. (*)
Writte by Staff Writer, edited by Roffie Kurniawan (email : firstname.lastname@example.org)