Non-PSC scheme is better for Jabung gas field

According to a study made by the Indonesian Chamber of Commerce and Industry (Kadin), applying a non production sharing contract (PSC) scheme in the Tanjung Jabung gas field in Jambi will give more benefits to the government.

“From the study, we learn that the implementation of non-PSC scheme in the Tanjung Jabung gas field gives more advantages rather than if it uses the PSC scheme,” the chairman of Kadin’s working group on mines and energy, Kusumo A. Martodiredjo was quoted as saying by Bisnis Indonesia on Thursday.

The working group in cooperation with the Center for Strategic Studies of Minerals and Energy (CSSME) has recently carried a comparative study on the government’s plan to integrate the Tanjung gas field (currently developed by PetroChina) and the liquefied petroleum gas (LPG) Betara Complex, which is developed by a consortium of PetroChina, Pertamina and Petronas.

Under the plan, the operation of both gas field and the LPG plant will be based on PSC scheme.

Kusumo said that the gas field and the LPG plant should be operated separately in order to comply with the new oil and gas law, which separates upstream and downstream operations.

He said with such a regulation, it would be more appropriate for the government to separate the operation of the gas field and the LPG plant. It means that the operation of the gas field, like other upstream operation, is based on PSC while the LPG plant, which processes the gas from the gas field should pay direct taxes to the government.

The separation of the gas field and the LPG plant is also necessary to avoid possible double tax payment. (*)