Local suppliers complain of foreign dominance

Local suppliers have complained about the domination of foreign firms in the supplies of goods and services for local oil and gas businesses, Jakarta-based daily Kompas reported on Thursday.

In terms of tendering, they complained that many oil and gas companies, especially the foreign ones, set too heavy requirements to be met by local suppliers, according to the secretary general of the Communication Forum of Goods and Services Suppliers for Production Sharing Contractors, Heroe Wiedjatmiko.

A Production Sharing Contractors (PSC) company, for instance, required tender participants to have a cash capital of US$3 million, a requirement local companies would not be able to meet during this time of crisis.

"It's time for (the government) to empower national companies, in the oil and gas exploration, exploitation and production activities. We are not against foreign firms, but please don't let foreign firms control from the upstream downward to the downstream level," Heroe said.

Heroe said with the dominance of foreign suppliers in Indonesian oil and gas companies, foreign parties took away with them 45 percent of total income from local oil and gas industry. First, they took away the 15 percent income, then they would take away with about 30 percent of production costs, in terms of supplies of goods and services. (*)