South Sumatra mulls imposing levy on gas pipelines

In a bid to collect more revenue in the autonomy era, South Sumatra is considering plans to impose levy on gas pipelines that pass through the province.

South Sumatra governor Rosihan Arsyad told Petromindo in a recent interview that the provincial administration was "seriously" considering the plan.

Under the plan, he said, the levy would be only imposed on the pipelines that transport gas to final buyer.

"The levy will only be imposed on the pipelines which transport gas to final buyer such as Gulf Indonesia Resource's gas from Grissik (in South Sumatra) to Caltex Pacific Indonesia in Duri (Riau province)," he said.

The pipelines in question is owned by state owned gas distribution company PT Perusahaan Gas Negara (PGN)

"PGN as transporter receives more than US$6 million per month from the pipeline while we (South Sumatra) gets nothing.

"I think it's only fair for us to receive some of the revenue because we have to take care of the pipelines' security. Whenever problems arise, we are the one who are responsible," said Rosihan.

However, Rosihan did not reveal the amount of the planned levy. (alex)