Regional administrations to be involved in oil and gas business

The government will open its doors for the regional administrations, who are interested in the oil and gas business to take part in both the upstream and downstream activities, a minister said.

In response to the several requests from the regional administrations to participate in the exploration, exploitation, stock management, transportation and other business activities of the oil and gas sector, the government has taken the decision to open its doors for the regional administrations in line with the Law No. 22/2001, Bisnis Indonesia newspaper on Monday quoted Minister of Energy and Mineral Resources Purnomo Yusgiantoro as saying.

?Under the Oil and Gas law No. 22/2001, the government has already given opportunities to state enterprises, regional enterprises cooperative societies, small scale firms and the private sector to participate in the oil and gas business,? Purnomo explained.

According to the minister, the government had already fulfilled the wishes of the regional administrations. For example, Riau administration was allowed to operate jointly CPP Block, which was taken over from Caltex, with Pertamina.

But in the case of East Java and East Kalimantan provinces, they have not yet got the chance to work with Pertamina because there are still some offers regarding regional contract of works.

Regional administrations want to participate in the core business activities but not in the non-core activities, said Bojonegoro regional legislature?s commission C deputy chief Onny Supriyadi when Bisnis contacted him.

?Bogonegoro regency and its legislature had expressed their area?s intention to participate in the operational activities of the Cepu oil field through their 10 percent stake in the company. It has also established its own company, PT Dharma Asri Sejahtera, with a capital of Rp 5 billion,? Onny said. (*)