Govt to limit executive pay at foreign oil and gas companies

The government will limit salaries of executives at oil and gas companies which operate in oil and gas exploration and production activities under a production sharing contract.

According to the Finance Minister?s new regulation, the foreign workers? salaries and remuneration would be based on their grades and countries of origins. At present, salaries and remuneration of workers at oil and gas contractors are paid by the government as part of the cost recovery mechanism.

Finance Minister Agus Martowardojo said that salary limitation was part of the regulation on the government?s payment to oil and gas contractors under the cost and recovery program. The finance minister, however, said although there would be limitation, the government would still respect the working standards of all companies engaged in oil and gas activities

In the new regulation, the remuneration for top executive such as president, country head and general manager is limited at $562,200 a year for those originating from Asia, Africa and Middle East (area I). For workers coming from Europe, Australia and the United States (Area II), the remuneration should not exceed $1,546,100 a year.

Meanwhile for second level executive such as senior vice president or vice president, the remuneration is limited at $449,700 for those coming from Asia, Africa and Middle East (area I) and $1,236,700 for those from Europe, Australia and the United States (Area II),

For the third level executive such as senior manager or manager the remuneration is limited at US$ 359,700 a year for those coming from area I, and $ 989,200 a year for those coming from area II.

Meanwhile, for professional position such as expert, the remuneration is limited at $ 287,700 for those coming from area I and $791,200 for those from area II. (*)