Expert says Riau can't control CPP block
Friday, November 3 2000 - 04:00 AM WIB
An expert said on Thursday the Riau provincial administration's plan of taking over the control of the Coastal Plains Pekanbaru (CPP) oil block after American oil and gas company PT Caltex Pacific Indonesia's contract on the field expires in 2001, went against the existing regulation.
Economist Muhammad Sadli, who is former Minister of Mines and Energy, said during a seminar on regional autonomy that under the governmental regulation No. 25/2000, the country's oil and gas resources were still under the control of the central government.
The regional administrations could only become the partners of the central government in controlling the resources, he said.
"Under the governmental regulation, the central government still handles the oil and gas affairs. The Riau provincial administration could only become a partner, which has shares (in the oil and gas resources)," Sadli said during the seminar organized by the University of Indonesia and the Riau University.
Riau is keen to take over the development of the CPP block after Caltex's contract on it expires next year, but the government would rather transfer the development of the block to a joint venture of Caltex and state oil and gas company Pertamina.
During the seminar, the staff expert of the Ministry of Home Affairs for law and legislation, AR Maklin, warned the regional administrations not to impose many taxes on companies after the implementation of the autonomy law.
He said the taxes to be introduced by the regional administrations should be adjusted to the regulation made by the central government.
"We are drafting the regulation on the issue," he said. (*)