Govt simplifies oil and gas permits

By Godang Sitompul

The government has streamlined the licenses in the oil and gas industry from the currently required 261 permits to only tens of them in order to further encourage investments in the industry.

The permits simplified were mostly concerned with those issued by local administrations in provinces, regencies, and mayoralties.

?Actually, the government has long been trying to simplify the permits. We see that with many permits required, especially those related to drillings that we?re trying to push right now, we need to streamline all regulations,? upstream authority SKK Migas? Public Relations Division Head Elan Biantoro told the press in Jakarta on Thursday.

Elan noted that actually the current number of required permits itself does not pose any significant problem for investment in the oil and gas industry. But problems could emerge if the local administrations slow down the process of licensing that could delay or even stall the production of oil and gas in the future.

?We?ve predicted that this year we could see about 1.152 well drillings realized. But that will happen only if the production sharing contractors (PSC) get their permits quickly and they face no obstacle in implementing the drillings,? he said.

He also said that currently the drilling plans are also dealing with non-technical problems, such as land permits and land clearance. These non-technical problems account for about 33 percent of all problems facing the investors in implementing their exploration activities. Also each local administration is different in their licensing system as each of them has different local regulations. That?s why we need one center of licensing service,? he said.

Editing by Benget Besalicto Tnb.