North Aceh opposes revenue split from oil, gas production

The legislative council of North Aceh regency has opposed the provincial legislative council?s decision on revenue split from the regency?s oil and gas production, Serambi Aceh reported on Saturday.

The vice chairman of the North Aceh Legislative Council, Hanafiah, said on Friday that it was unfair if North Aceh received only 25 percent of the government?s revenues obtained from its oil and gas production.

He warned that the unfair oil and gas revenue split could further incite anti-government protests and separatism in the regency, which is often used by separatist group Free Aceh Movement (GAM) as its headquarter.

The oil and gas split also incited protests from student leaders and businessmen in the regency.

The provincial legislative council recently approved the revenue sharing formula proposed by the local administration. Under the split formula, a regency where oil and gas development is located is allowed only to receive 25 percent of the revenue obtained by the province from such activities, and 40 percent to the provincial administration. The other 35 percent are distributed to other regencies in the province.

Hanafiah said that North Aceh, which hosts one of the country?s largest gas field, should receive at least 40 percent of the oil and gas revenues.

Under the autonomy law, the province receives 15 percent from oil production and 30 percent from gas production from the government?s shares. Under the existing regulation, the government through Pertamina gets 85 percent from oil production and up to 70 percent from gas production, the remaining portions are given to contractors or producers. (*)