Include trade ministry in the drafting of oil and gas bill: Gapipa
Monday, April 30 2001 - 05:00 AM WIB
The Association of Indonesian Steel Pipe Producers (Gapipa) has called on the Ministry of Energy and Mineral Resources to involve officials from the Ministry of Industry and Trade in the drafting of oil and gas bill so that the bill, when passed into law, could also protect local industries, including local steel pipe producers.
Gapipa deputy chairman Abas F. Soeriawidjaja said the government thus far did not protect local pipe industries especially in the provision of steel pipes for local oil and gas industries, and thus allow dumping practices by foreign pipe producers in the local market.
"Thus far the government, in this case the Ministry of Energy and Mineral Resources, does not consider the existence of national pipe businesses as important," he said.
He said the recent dumping of steel pipes from South Korea and Japan for the Natuna gas piping project proved that the government did not care about the existence of local pipe industry.
"I'm confident that the Ministry of Industry and Trade will defend our interests, especially to impose import duties for products imported by Pertamina subcontractors," Abbas said.
He noted that Law No. 8/1971 on Oil and Gas allows the zero-tariff importation of materials by Pertamina subcontractors. And this clause must be revised to protect local industries, including the pipe industry.
Abbas noted that such a revision was necessary to be pursued soon considering that Pertamina, in cooperation with its gas contractor Gulf Indonesia, would again tender the provision of steel pipes, totaling 90,000 tons of steel pipes, for the contraction of gas piping lines from South Sumatra to Singapore.
He noted that local pipe industries were willing to compete with foreign players provided that the government provided level-playing fields and would not again allow dumping practices by foreign players.
He explained that the government's helps to revive local pipe industry was badly needed as the industry was currently operating at about 30 percent of its maximum production capacity of around 1 million tons of pipes per annum. (*)