East Kutai may still obtain greater oil, gas revenue share

The East Kutai regency may still obtain a greater portion of oil and gas revenue this year, the local Radar Kaltim daily said Tuesday.

A final meeting between the East Kutai administration and the central government in Jakarta agreed that the additional portion of the oil and gas revenue for East Kutai would be decided in October when the central government makes a review or adjustment on the current 2001 state budget.

The meeting agreed on several options including certain contribution from the neighboring Kutai Kertanegara regency. From higher realization in oil and gas production in the province, which according to the law, 12 percent of revenue from the excess production should be allocated to the non-oil and gas producing areas in the particular province. It has been decided that 6 percent will be allocated to East Kutai. The additional revenue could come from exchange rate differential as the current budget is now using an exchange rate assumption of Rp 9,600 per U.S. dollar, compared to Rp 7,800 per dollar in the original budget.

But all the options have yet to obtain approval from the respective local parliaments.

The East Kutai administration has protested the Rp 138 billion oil and gas revenue fund allocated to the regency for 2001, which was much lower than the original plan of Rp 838.7 billion announced in November last year.

The central government cut down the allocation after finding out that there was a mistake: the oil and gas-producing Kutai Kertanegara regency only obtained Rp 945 billion in oil and gas revenue, a relative similar amount to that obtained by East Kutai, a non-oil and gas producing area. After a protest from the Kutai Kertanegara administration, the government then decided to increase the allocation to Rp 1.4 trillion, and lowered the allocation for the East Kutai administration.(*)