Lawmakers in a special inquiry on the management of oil and gas have unveiled irregularities involving powerful foreign donors in pushing forward the amendment of a 2001 law.
Head of the House of Representatives' inquiry committee Zulkifli Hasan said Wednesday that lawmakers had received reports that one of the donors disbursed some US$21.5 million as a "supporting" fund to push lawmakers to amend the oil and gas law with foreign interests in mind.
"The amended law has reduced the role of the state in the management of oil and gas. It now more serves the interest of traders and contractors," Zulkifly said after a closed-door meeting with oil and gas experts.
Zulkifly said the $21.5 million was channeled between 1999 and 2000 for launching an intensive campaign to amend the law.
"We do not yet know where the money really went at the time," he said.
The team's deputy head Max Sopacua said the team would investigate the basis of the law's amendment, as lawmakers were suspicious of collusion.
"This will be investigated further by the inquiry team," he said, adding that the recent cases of lawmakers caught receiving bribes meant such suspicions could not be overlooked.
The House has formed a special inquiry committee to question the government's policy in raising fuel prices, following strong public protests and allegations that billions of dollars in revenue from the oil and gas sector were lost through inefficiency and corruption.
Energy analyst Kurtubi of state-owned oil and gas company PT Pertamina believed the foreign donors' lobby resulted in the liberalization of the country's oil and gas sector.
The forming of the upstream oil and gas regulator BPMigas, which is largely considered toothless in confronting foreign oil and gas giants, was among the liberalization products supposedly aimed at overseeing the sector.
"While the agency has no capacity and full knowledge of the oil and gas sector, it could be easily used to compromise on any demand from oil and gas contractors."
"BPMigas' status as a state institution which cannot do business has caused it to require other parties to carry out its job," Kurtubi said.
The Constitutional Court overruled in 2004 several clauses in the amended law, including those related to leaving the authority of managing oil and gas concessions to the private sector instead of the government's state companies.
Another product of the law is the downstream oil and gas regulator BPH Migas, which Kurtubi said had played a role in the controversial negotiation of a contract to sell gas from the Tangguh field in Papua at far-below-market prices to China.
Kurtubi said the law had failed to form a supervisory committee for both BPMigas and BPH Migas, both of which have often issued controversial policies.
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