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Thursday, October 27, 2016

Regulatory Reform Needs, Accelerate Oil and Gas Infrastructure

According to an economic observer from Airlangga University, Dr. Nafik HR, the current government must reform its economic policies which are still using a neoliberal paradigm by replacing them with economic policies that are in favor of the people's and national interests and of course constitutional.

Let's just say frankly that the abundant natural wealth so far has been managed by foreign parties, and it is very profitable for them. Therefore, this is what must be taken over to become fully national control.

Then protect the control and development as well as the use of alternative energy such as geothermal, hydropower, solar power, and others that are still very potent. Later it can be managed by state companies such as Pertamina or other national private companies, to help the Indonesian government reduce national imports and in order to increase the production of domestic energy resources and consumption.

Of course, to manage this abundant oil and gas sector and alternative energy, Pertamina needs full support, especially regulations from the government, because so far it turns out that, in terms of managing oil and gas resources, Pertamina is not given the main authority and especially when compared to foreign companies such as Petronas (Malaysia). ), Shell (Netherlands), Chevron (USA), Total (France), ConocoPhillips (USA), ExxonMobil (USA), CNOOC (China), ENI (Italy), KUFPEC (Kuwait), British Petroleum (UK), and so. Just look at how the Regulation of the Minister of Energy and Mineral Resources Number 15 of 2015 is actually very detrimental to Pertamina.

So that whenever this country is declared to exist, the hope that this nation will have energy independence will definitely not be realized. The government's mistakes in the past in managing our natural wealth should be used as a lesson so that in the future it will be returned again for the prosperity of the people.

A legal observer from the University of Muhammadiyah Surabaya (UMS) Umar Sholahudin assessed that regulation is still seen as one of the homework that must be done in national development planning. Umar admits that there are many overlapping, multi-interpreted, disharmony, or inconsistent laws and regulations, all of which actually disturb the investment climate or economic growth, for example, there are regulations governing the same sector but with different mechanisms.

Not a single state institution knows the exact number of laws and regulations issued by the central government and local governments. It means that the government, and the House of Representatives (DPR), are not serious about reforming regulations. The Minister of Energy and Mineral Resources Regulation No. 15/2015 on the management of Oil and Gas working areas whose contract period will expire is very clearly detrimental to Pertamina as a state company.

This ministerial regulation considers Pertamina to be the same as other oil and gas companies when it wants to take over the management of the oil and gas Working Area (WK) which will expire. The full authority of the Ministry of Energy and Mineral Resources to choose/determine which companies will be granted oil and gas management concessions will undermine Pertamina's important role.

In fact, the ministerial regulation has clearly stated that the government does not at all give guarantees to Pertamina to control the concession of the oil and gas working area which will expire, even though there has been a Government Regulation of the Republic of Indonesia Number 35 of 2004 which favors the national interest in terms of controlling national oil and gas resources.

In short, Pertamina must be more empowered, play a dynamic role in obtaining full concessions or the holder of all concessions for all projects at the forefront of the oil and gas and energy sectors so that they have a major impact on Pertamina's progress, and can choose partners if necessary.

In the 2015-2019 National Medium-Term Development Plan (RPJMN) stipulated by Presidential Regulation No. 2 of 2015, energy security is described as to the extent to which energy can be provided in a timely manner and with guaranteed availability, affordable prices, and acceptable quality.

The indicators are the amount of energy, the availability of infrastructure, the price of energy, the quality of energy, as well as the energy portfolio or mix. Energy security also has an element of sustainability so its management must pay attention to the carrying capacity of the environment. According to Dwi Sutjipto, the government is serious about realizing energy independence, as evidenced by the acceleration in the development of energy infrastructure projects.

Various regulations stimulate the development of energy sources at a time when there is a lack of discovery of national oil and gas reserves and fluctuations in world oil prices. The acceleration of energy infrastructure is the main key to creating energy independence now and in the future.

According to Dwi Sutjipto, Pertamina has become the backbone of national energy fulfillment. Not only contributing to the production of energy sources in the form of oil and natural gas which contribute as foreign exchange for the country, Pertamina also has the task of providing and distributing the ever-increasing supply of fuel oil (BBM) and gas.

Pertamina's Vice President of Corporate Communication Wianda Pusponegoro explained as a national oil company (NOC) Pertamina has the responsibility to ensure that energy supply is always in a safe condition for national energy security, under any circumstances. In order for this to be realized, Pertamina has launched 5 strategic priorities, namely, the development of the upstream sector, efficiency in all lines, increasing the capacity of refineries and petrochemicals, developing infrastructure and marketing, and improving the financial structure.

Wianda Puponegoro

According to Wianda, the five strategic priorities are implemented through various innovations. Pertamina's innovations include ensuring that all projects to support energy independence continue. Such as refinery development projects and the construction of new refineries, as well as the development of marketing infrastructure continues according to the established roadmap. International business development is a critical factor for Pertamina to develop into an international class company and to support the realization of national energy security.

Bhirawa, Page-4, Wednesday, Oct 26, 2016

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