Sidoarjo district wants income sharing from exploitation of gas
Wednesday, February 28 2001 - 04:30 AM WIB
The Sidoarjo district administration in East Java, will demand to the central government an income sharing from the exploitation of natural gas in Wunut, Porong, Sidoarjo, by state oil and gas firm Pertamina.
Although Pertamina, through UPPDN V, in cooperation with PT Lapindo Brantas, has exploited gas in Sidoarjo for the past three years, the Sidoarjo administration has not yet got its portion of income from the gas exploitation.
The spokesman of the Sidoarjo administration, Soewasis MM, said that the administration did not demand for income sharing for the past three years because there were not enough legal foundation for the administration to pursue such income sharing.
But now, with the implementation of Law No. 25/1999 on fiscal balance between the central and local governments, Soewasis said that his administration would demand a portion of income from the gas exploitation.
"So, in this law, it is stated that regencies that host oil and gas exploitation activities have the rights to get a portion of the income from the exploitation," he said.
According to the law, 85 percent of net income from oil and gas exploitation goes to the central government and the remaining 15 percent goes to local administrations, including district and provincial administrations.
Out of the 15 percent income portion, 6 percent goes to the host district administration where oil and gas exploitation activities are located, 3 percent goes to the provincial administration and another 6 percent goes to other district administrations in the same province.
But the Sidoarjo administration does not know yet how much income Pertamina gets from its Sidoarjo operation.
Soewasis said that his party would form a joint research team, in cooperation with the local mining office and Pertamina, to gauge how much income generated from the gas exploitation activities in Sidoarjo.
"We will soon conduct the research, with hopes that we will know the exact figure of income. Then, we will demand for income sharing for this budget year," he said.
Currently Pertamina operates three gas wells in Sidoarjo. But according to field research conducted by Sidoarjo mining office, Pertamina could drill up to 24 gas wells to tap gas reserves in the area.
The head of Sidoarjo mining office, Bambang Sutomo, said that with 24 wells, gas in Sidiarjo will be enough to be exploited for the next 15 years. (*)