Setting up an oil-and-gas business in the country can be a long and painful effort that starts as soon as an investor signs up to obtain a government license.

To get a temporary business license, the legal basis to immediately start business operations, investors in the energy sector normally require between 20 and 45 days as they go through a lengthy, layered screening process involving officials from various government institutions.

Many who are unlucky even have to go through the process more than once should an official find errors in their paperwork, as they are not allowed to make amendments in the middle of the procedure.

So imagine squeezing such hassles into just three hours and at a single venue.

In an effort to boost investment in the energy sector, the Investment Coordinating Board (BKPM), in cooperation with the Energy and Mineral Resources Ministry, launched on Monday a special service that allows the prompt issuance of temporary licenses for eight businesses in the downstream oil and gas sector and one in the electricity procurement sector.

Company executives needing such licences can access the service by submitting the required documents at BKPM’s one-stop integrated services (PTSP) office in Jakarta.

Applicants are also guaranteed to bring home a license within three hours if they can provide all administrative and technical requirements stipulated by the government, including their company’s deed of establishment and tax number.

BKPM chief Thomas Lembong said the new procedure was expected to help reach the government’s target of sourcing up to 50 percent of investments this year and next year from the energy sector.

“Exports are still sluggish. Our consumer spending is strong, but we cannot encourage more or we would become an over-consumptive country. Investments [in energy and mineral resources] are the one thing we can boost,” he said.

Investments in the energy and mineral resources sector have continued to comprise a large chunk of total investments in the country.

BKPM data show that investments in the energy and mining sector, not including the upstream oil-and-gas sector, contributed to 21 percent of total investments, or Rp 490 trillion (US$36.75 billion), from 2012 to 2016. Almost half of the investments were poured into the electricity sector.

Prior to launching the service, the BKPM also introduced a similar facility for investors hoping to set up business units in Indonesia. Unlike the previous service, investors in the energy sector are not required to commit to a minimum investment amount or number of workers hired to access the speedy licenses.

The Indonesian Chamber of Commerce and Industry’s (Kadin) deputy chairman for the oil-and-gas industry, Bobby Gafur Umar, considered BKPM’s new service a “breath of fresh air” for investors, as it makes Indonesia a more competitive and appealing country to invest in compared to others.

He, however, mentioned other obstacles in the energy sector the government must address, including high transportation and distribution costs caused by poor infrastructure, high capital and investment needed due to national banks’ high interest rates, and low economic feasibility in the upstream and downstream oil-and-gas sectors.

“Because of such factors, the government still has a lot of work to do in order to boost investment in the oil-and-gas sector,” he told The Jakarta Post.

With energy prices falling over the past couple of years, players in the country’s oil-and-gas industry have been calling on the government to provide new incentives and push policy reform to encourage investment and revive the ailing sector.

Kadin’s head of energy, oil and gas regulations, Firlie Ganinduto, meanwhile urged the government to also ease the application process for permanent licenses as business players would feel “tricked” if the process remained difficult.

Energy and Mineral Resources Minister Ignasius Jonan said only temporary licenses would be handed out through the new service as a means to expedite investors’ activities while they applied for permanent licenses.

“If businesses do not fulfill the requirements [for permanent licenses], then we will revoke the [temporary] license,” he said.

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