House endorses chairman of oil and gas body
The Jakarta Post, Jakarta
The House of Representatives has endorsed Rachmat Sudibyo, the director general of oil and gas at the Ministry of Energy and Mineral Resources, to become the chairman of the newly established oil and gas authority, called the Implementing Body.
Against the expectations of many analysts that the selection of the first chairman of the body would be tough, House Commission VIII for environmental, science and technology affairs, took only three hours, from 9 a.m. to 12 p.m. on Thursday, to complete the discussions on the government's proposal of Rachmat.
Priyo Budi Santoso, commission member of the Golkar Party, said on Friday that after a fit-and-proper test, during which members of the commission questioned Rachmat about his vision and mission, the commission had no objection to his appointment as the first chairman of the body.
"He knows a lot about oil and gas. Furthermore, he assured us that he is a professional and not affiliated to any political party," Priyo said.
Rachmat, who studied oil technology in Indonesia and France, was the secretary of the board of commissioners of state oil and gas company Pertamina, before being appointed director general of oil and gas in 1999.
According to Priyo, Rachmat was the only name proposed by the government for the top position of the new body, which is locally known as Balak.
Under Oil and Gas Law No. 22/2001, the Balak will take over the various functions that have been held by Pertamina for decades, which includes the awarding of oil and gas contracts, the supervision of oil and gas operations and the regulating of the industry. The body will take over the functions currently being performed by a special directorate in Pertamina, called the directorate of production sharing contract management.
Many analysts have predicted the chairmanship will become a bone of contention among politicians, because it could provide numerous opportunities for the illegal collection of financial resources.
Priyo said the commission could not spend much time debating the nomination of Rachmat because the House would go into recess starting on Saturday until the middle of August.
The government, which proposed the name to the House on Wednesday, pushed the House to decide before the recess to enable the new body to sign the transfer of concession by American oil and gas company PT Caltex Pacific Indonesia on Aug. 6. Caltex will transfer its Coastal Plains Pekanbaru concession to the government as its contract on the concession will expire that day.
"We sort of did not have a choice but to endorse the nomination of Rachmat. Anyway, we finally endorsed him because we consider him capable," Priyo said.
Rachmat added he had not yet been informed of the schedule for his installment as the first Balak chief.
"But, I hope it (the Balak) can start operating in August," Rachmat told the Post.
Under Government Regulation No. 42/2002 signed by President Megawati Soekarnoputri, the Balak chief will be assisted by a vice chief and a maximum of five deputies. The vice chair and deputies are appointed and dismissed by the minister in charge of oil and gas on the proposal from the Balak chief. In addition, the Balak chief will be assisted by a maximum of five experts.
All employees of Pertamina's directorate of production sharing management will be transferred to the new body, where they will receive salaries at least equal to the amount they receive at Pertamina. After one year, the 600 employees will be offered the choice of whether to return to Pertamina or continue working at the Balak, according to the government regulations.