Govt urged to amend contract of works in oil and gas
Thursday, July 26 2007 - 02:06 AM WIB
The Supreme Audit Agency (BPK) has urged the government to amend several contract of works in oil and gas sector, particularly terms related to cost recovery, in order to improve efficiency, Bisnis Indonesia reported Thursday.
BPK’s head Anwar Nasution said in Jakarta Wednesday that the government and oil and gas upstream regulator BPMIGAS should set clear what expenditures are to be included in cost recovery should be made in order to prevent state loses.
It is urgent to amend several clauses in the cost recovery because otherwise, the government will suffer losses, he said.
A report presented to the House of Representatives says cost recovery may US$10.4 billion this year.
“I want Purnomo (Minister of Energy and Mineral Resources Purnomo Yusgiantoro) to pay attention to this. We have enjoyed the status as an independent state for 62 years but the problem has yet to be solved,” he said.
He criticized BPMIGAS for its poor performance, advising the body to hire a capable accountant and law expert given that oil and gas remain the major source of state revenue.
Meanwhile, deputy head of BPMIGAS Abdul Muin said that the government could not easily amend the contract of work. “We cannot amend the contract as we like. Somehow, it is the form of law certainty,” he told the daily
According to Abdul Muin, BPMIGAS has done a maximum effort to supervise oil and gas contractors to ensure efficiency in cost recovery. (*)