Kadin warns govt over planned petroleum fund

By Godang Sitompul

The Indonesian Chamber of Commerce and Industry (Kadin) warns the government to be extra careful in implementing the proposed petroleum fund in the oil and gas sector.

Kadin Deputy Chairman Sammy Hamzah explained to Petromindo.com Thursday that while the use of such funds for the purpose of geological data collection may be beneficial, but the effectiveness must also be seriously taken into account by taking a deeper look on the cost and benefit comparison. ?The urgency of such fund must be further reviewed,? he said.

Kadin is seriously responding to the plan to include the petroleum fund proposal in the revision of the Oil and Gas Law No 21/2001.

Sammy added that Kadin is also concerned with the issue of transparency in the management of the fund, pointing out on the possibility of the funds being abused. ?Don?t let it become a new problem because the funds are to be taken from the state budget,? he said, adding that Kadin will make a deeper review about the proposed petroleum fund.

Vice Minister of Energy and Mineral Resources Rudi Rubiandini, however, said earlier that funding for the planned petroleum fund will not be taken from the state budget, it would be taken from part of the gross revenue of all PSC holders (5 percent).

Rudi said that the petroleum fund will be used by the government among others for preliminary explorations in deepwater area in order to attract investors into the high-risk areas.

Editing by Reiner Simanjuntak