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Falling oil and gas production main problem in energy sector: Expert
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Workers tighten a drilling machine at an oil and gas block in Maluku. (kompas.com/-)
R
eformation in the energy sector must address the main problem in oil and gas sector, namely declining oil and gas reserves, as well as production, an energy expert has said.
Jakarta-based energy think tank ReforMiner Institute executive director Komaidi Notonegoro said energy reform had begun with Ignasius Jonan's predecessor, Sudirman Said, who was sacked in the second Cabinet shake-up in July.
"I think the main point of energy reform is to improve performance, address the substance of the problems in the energy sector, namely the decrease in reserves and production of oil and gas," Komaidi told The Jakarta Post on Tuesday.
Instead of revising Government Regulation (PP) No.79/2010 on cost recovery and taxes for the upstream oil and gas industry, he explained, Energy and Mineral Resources Minister Ignasius Jonan and deputy minister Arcandra Tahar should focus on the amendment of the Oil and Gas Law to tackle the problem.
Komaidi agrees with Arcandra's view on the need to improve oil and gas production, through more exploration. He, however, considers the revision of PP 79/2010 to not be enough to attract investors to explore Indonesia's upstream energy sector.
"I think it's just a small part of efforts to increase exploration. The root of the problem is the revision of the Oil and Gas Law. If the amendment is approved immediately, the supporting regulations will automatically adjust," he went on. (ags)
