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n a bid to avoid losses in state revenue, the Corruption Eradication Commission (KPK) urges Energy and Mineral Resources Ministry to immediately regulate investment credit given to oil and gas contractors.

KPK deputy chairman for corruption prevention, Haryono Umar, said Wednesday that the investment credit was actually "bonuses" given by the government to oil and gas contractors in a bid to encourage more investment in the sector.

"The problem is there is no legal umbrella for this *incentives in oil and gas sector investment*," Haryono said .

He added that the KPK had asked the director general for oil and gas at the ministry to formulate the legal basis, "so that the investment credit will not cause losses in the state revenue".

On Tuesday, KPK and Evita H. Legowo, director general for oil and gas at the ministry had a meeting discussing possible measures to prevent losses in state revenue from the oil and gas sector.

KPK did not see any legal umbrellas for the investment credits granted by the ministry.

Haryono said the KPK also found out that the government paid the investment credit together with the payment of the cost recovery.

But the KPK has yet to know the exact figure of investment credits that have been given by the government.

"The ministry said they were still calculating this," he said.

Haryono added that this year, upstream oil and gas regulator BPMigas returned as much as Rp 2.6 trillion (US$ 254.53 million) of the investment credits to the state.

"A large portion of this was derived from the overpaid investment credit."

He added the KPK did not intend to suggest that the ministry fully scrap the investment credit in the country's oil and gas industry.

KPK, he added, needed clarification on the usage of state revenue.

"When the government uses state revenue, we need to know on what basis the money is spent."

No comments received from both director general for oil and gas Evita H. Legowo and BPMigas' chairman R. Priyono, as the two did not return phone calls and text messages asking confirmation.

Ryad Chairil, director executive of the Centre for Indonesian Energy and Resources Law, fully supported the KPK move asking for regulations on the investment credit.

"Investment credit is one of the reduction factors of the state revenue from oil and gas sector. If the investment credit is not regulated, we are concerned that leakage in our state revenue will get bigger.

"If this happens, no matter how big our oil production is, our state revenue will never increase," Ryad said.

The oil and gas sector has been the backbone of the country's state revenue.