Govt has Drawn up Strategies to Lift Investment, Says O&G Director General

MINISTRY OF ENERGY AND MINERAL RESOURCES

PRESS RELEASE

NUMBER: 027.Pers/04/SJI/2021

Date: 18 January 2021

Govt has Drawn up Strategies to Lift Investment, Says O&G Director General

The Indonesian Directorate General of Oil and Gas has drawn up a number of strategies to lift the oil and gas investment which has been impacted by the Covid-19 pandemic, said Director General of Oil and Gas of Ministry of Energy and Mineral Resources (EMR) Tutuka Ariadji at the press conference on Performance Report of 2020 and Work Plan for 2021 of the Oil and Gas Subsector in Jakarta on Monday (18/1).

On the upstream side, an initial step that has been made by the Indonesian Government is to allow a flexible contract, in the forms of a Gross Split Production Sharing Contract (PSC) or a Cost Recovery PSC. Such flexibility had been decided by Minister of EMR Arifin Tasrif in Ministerial Regulation Number 12 of 2020.

Other steps include promotion of 128 oil and gas basins--68 of which are yet to be developed--opening of data access to investors under a membership system, and creation of an incentive scheme to boost remote and deep-water development.

On the downstream side, the Indonesian Government is seeking cooperation with business entities to build new refineries (Gross Root Refinery, GRR) and expand refinery capacity (Refinery Development Master Plan, RDMP).

The Indonesian Government is also committed to more simple downstream licensing, affordable natural gas price, integrated construction of oil and gas infrastructure, and the shift from diesel oil to gas fuel as set out in Ministerial Decision Number 13 of 2020.

For the record, the Indonesian Government has set an investment target for the oil and gas subsector at USD17.59 billion, which is up by 45% on the year 2020. The oil and gas subsector remains a key driver of the national economy.

"The oil and gas subsector remains a key driver of regional development. In 2020, the subsector attracted USD12.09 billion of investment out of target USD13.36 billion," said Tutuka. (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (08112213555)

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