T

he three-day Indonesian Petroleum Association (IPA) Conference and Exhibition has ended with the government pledging to make vital bureaucratic reform to improve the investment climate of the oil and gas industry.

It was exactly what the conventioneers would have been wanting to hear at the biggest and most successful IPA gathering. A total of 16,128 people attended the May 15-17 event, a staggering increase from 8,000 in 2012.

This stated intent began with President Susilo Bambang Yudhoyono's opening address to the 37th annual INPEX, organized by the IPA at the Jakarta Convention Center last week.

'I have instructed the Energy and Mineral Resources Ministry and relevant government institutions to improve the investment climate,' he said.

'One way is to slim down the permit or licensing process for faster investment realization. The dozens of permits for exploration and production must be reduced and simplified to maintain smooth business activities without violating existing regulations.'

The government already has a team assigned to trim the number of permits required for investment in various industries, especially oil and gas. The government's team is led by the coordinating economic minister and the head of the Investment Coordination Agency (BKPM). The President added that rules and regulations must be able to create a smooth process for investment so that bureaucratic reform of the oil and gas upstream sector could be implemented and for regulations to be simplified to overcome hampering factors.

Given that oil and gas investments are long-term projects, it is only to be expected that the government must maintain a conducive investment climate, including regulations safeguarding investors.

'The government is aware of the challenges in the upstream production sector and of the problems that keep cropping up, but have to be faced wisely and strategically while at the same time finding solutions,' Yudhoyono said.

The President reminded central and regional administrations of the importance of the oil and gas industry.

'It is a vital sector, as it is the main contributor to national development, therefore we all should have the right approach,' he said.

Meanwhile, BKPM chief Chatib Basri said the government formed a team comprised of officials from several departments to smooth out the investment administration process. The team will use online tracking of permit documents and reduce the number of forms required by BKPM 'and apply such simplified procedures at other agencies.

'I have discussed this with the Taxation Directorate General. Investors are complaining about lengthy periods, payments and numerous administrative requirements. We discussed in detail about how we can streamline things for a simpler process,' Chatib said.

Energy and Natural Resources Minister Jero Wacik said that oil and gas contractors should not be concerned about the investment climate during the 2014 presidential election, asking the IPA to step up its role as a facilitator between investors and the government.

'Hence this IPA Convention and Exhibition has great resonance and will be full spirited with bigger efforts,' Wacik said.

This year's IPA Convex was deemed the largest in the event's history, featuring 260 exhibition participants, compared to 170 last year.

'Actually last year's event was already large and at that time I asked IPA to invite the President. And now the President is here, so it is expected that his presence can attract the world's oil and gas investors to line up here,' said Wacik.

He added that the government appealed to all investors to support Indonesia's economic objectives for growth, jobs, poverty alleviation and the environment.

'The government does not want investments in the oil and gas sector to produce only profits without creating more jobs, reducing poverty and preserving the environment,' he said.

IPA President Lukman Mahfoedz said the convention was held with the aim to boost oil and gas investments in Indonesia.

'We hope the event's theme, 'Promoting Investment in a Challenging Environment', can provide solutions for this matter,' he said.

He said the theme was in line with IPA's desire to support the government's program to achieve an oil production target of one million barrels per day while simultaneously perfecting oil and gas management.

The convention was also expected to become a communications medium for all industry stakeholders to improve the industry's capacity in Indonesia.

There were three plenary sessions at the event. On the first day, a discussion titled 'The Current Outlook for the Global Oil and Gas Industry' touched on macroeconomics, focusing on the role of oil and gas industry in supporting development and responding to challenges for energy requirement.

The second day's topic, 'Global Industry Success Story', covered the success stories of other countries in applying energy policy and technology.

'How Can Indonesia Realize Its Potential?' was the topic of the final day, discussing investor activities and the investment climate needed for further development in Indonesia's energy sector.

IPA Convex also presented a number of new programs, including photo and writing competitions for the young generation to give their perspectives on the upstream oil and gas industry here.