Expectations for the gas block are high, with its development being among the 37 National Strategic Projects (PSN), which are regulated under Presidential Regulation No.58/2017.
n a recent House of Representatives hearing, a legislator from the opposition Gerindra Party criticized the government over its snail’s-pace progress on a plan of development (PoD) for the gas-rich Masela block.
Kardaya Warnika denounced the government’s lack of firmness in making a decision on whether it would approve the development plan proposed by Masela’s operator , Japan’s Inpex Corp, which holds a 65 percent stake in the block.
“The [oil and gas] law is clear. Any [contractor or operator] that fails to develop the block within five years after the approval of the first PoD will automatically face contract termination,” Kardaya said of the block, the development plan of which has been under preparations for a decade.
“It [Masela block development] has been [almost] 10 years, but the government still gives them [the right to operate], despite there being no construction at all. […] We need the government’s firmness in enforcing the law,” he said.
Kardaya was referring to Article 17 of Oil and Gas Law No. 22/2001.
Energy and Mineral Resources Minister Ignasius Jonan, who represented the government in the hearing, countered Kardaya’s statement, saying he would stick to Government Regulation No. 35/2004 on upstream oil and gas, which is a derivative regulation of the prevailing law.
“I’m convinced that I did not violate the law [by not terminating the contract]. I think you believe that I’ve disobeyed the law. Well you could just report me [to the authorities] then,” the former transportation minister replied.
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