Govt to issue regulation on revenue split from geothermal production

The government will soon issue a new regulation to end the dispute between central government and local government over the revenue sharing scheme from the country's geothermal production, Koran Tempo reported on Monday.

"The new regulation is now under preparation and we hope it will be ready before the end of this year," Sukhyar, the secretary of the ministry of energy and mineral resources said in Jakarta last week.

He said that the new regulation would be used as the guideline in determining the percentages of the revenue from geothermal production that must go to the central and local governments.

"The issuance of the regulation is needed because the existing geothermal law has yet to cover the revenue sharing arrangement," he said. According to him, under the new regulation, the central government will receive 20 percent from the geothermal revenue, while the remaining 80 percent will go to the local government.

Of the 80 percent-revenue, 16 percent will go to the provincial administration, 32 percent to the regency where the geothermal project is located and another 32 percent to other regencies in the province.

The government of Garut regency in West Java has refused to issue a permit for the expansion of the Darajat geothermal production in the regency in protest to the unfair distribution of income from the existing geothermal projects. (*)