Oil and gas bill ensures stable supplies of fuels

The oil and gas bill, currently deliberated by the House of Representatives, aims to ensure the stable supply and prices of fuels in the domestic market.

The government will continue to ensure a careful approach in dealing with the distribution, storage and pricing of fuels.

The bill also aims to correct inefficiencies in fuel management in the past so that it will not reoccur in the future, according to Minister of Energy and Mineral Resources ad interim Sonny Keraf.

Keraf temporarily replaces Purnomo Yusgiantoro, who is currently Islamic Haj pilgrimage to Mecca, Saudi Arabia.

When reading the government's response to legislators' questions about the bill, Keraf said the government would not just let the market mechanism to rule the distribution and pricing of fuels. The government would still play a role in stabilizing the supply and prices of fuels.

Keraf said the philosophy behind the bill that lets private investors to be involved in the distribution and marketing of fuels is that the government wants to give more freedom to the people to get the best price and quality of fuels from the many fuel suppliers available in the market.

He noted that there was always possibility for the government to take policy about the supplies and services of fuels, based on the principles of good corporate values and efficiencies.

The government will still be required to ensure the supplies of fuels to remote areas at reasonable prices, through, for instance, an agency that will be formed to take care of fuel supplies to remote areas.

Keraf also noted that that the entrance of foreign investors into the upstream oil and gas industry would still be under the government's control, through a managing agency.

"(Domestic or foreign own) companies will be given chances to conduct activities in the upstream level through a cooperation with the managing agency. The agency will be answerable to the government," he said.

Keraf also noted that foreign investors could enter downstream oil and gas industries, including retail businesses, provided that they pursue those businesses through companies or subsidiaries incorporated in Indonesia. (*)