Pertamina may lose privileges under new oil and gas law

State owned oil and gas company Pertamina might lose exclusive rights in the exploration and production of oil and gas resources in the country if the new oil and gas bill now being prepared by the government is approved by the House of the Representatives.

Djoko Darmono, the secretary general of the mines and energy ministry, told Sumatera Express on Friday that under the proposed law, the status of the state oil and gas company would be changed into ordinary limited company, meaning that Pertamina will no longer be given a special status.

He said that the change in the status would be needed to give more flexibility to Pertamina's business expansion.

Under the existing law, Pertamina holds the exclusive rights in operating and managing the oil and gas resources. But the privileges often become a handicap in its operation.

The government, during the previous cabinet, has proposed the change in the oil and gas law but the proposed law was rejected by the House of Representatives due to a strong resentment from Pertamina, which had made any efforts to maintain its exclusive rights. (*)