Kuntoro about to throw in towel over oil bill
Kuntoro about to throw in towel over oil bill
JAKARTA (JP): Minister of Mines and Energy Kuntoro
Mangkusubroto said on Friday he was on the verge of giving up his
four-month fight with the House of Representatives over the oil
and gas bill.
"My hope for the bill to be enacted is fading," Kuntoro said
after eleventh hour lobbying with the House's special team
handling the bill.
"The deliberation seems to be going in circles."
The House and the government, which sponsored the bill,
previously set a Monday deadline for approval by legislators.
"I am going home now uncertain whether there will be a meeting
to discuss the bill. I will just wait for the House to extend an
invitation." He said the chance of the bill being endorsed was
slim.
Legislators have until Sept. 20 or Sept. 21 to decide on the
fate of the bill, he said.
The sitting House completes its term later this month to make
way for legislators elected in the June general election.
The government and the special team have been at loggerheads
over who will hold the right to grant lucrative oil exploration
contracts, currently held by state oil and gas company Pertamina.
The government said the right, in the form of extending
business licenses, should be handed over to the Ministry of Mines
and Energy. The House insisted that it should be retained by
Pertamina.
Another moot point has been the fate of existing production
sharing contracts held by foreign oil companies in the event the
government took over the right.
Accusing House members of protecting the interests of
Pertamina, Kuntoro said the deliberation was not likely to reach
consensus.
"There can be no further negotiation. Only the government has
the right to grant business licenses," Kuntoro said, adding that
his offer was final.
In arguing for the right of Pertamina to grant contracts, the
House said the government should not conduct business deals with
oil and gas multinationals.
The government proposed converting contracts into business
licenses to regulate oil exploration and exploitation activities,
including the government's entitlements, taxes and compliance
with environmental rules.
Kuntoro and legislators appeared to have reached an agreement
last month when the bill was sent to the House's board of leaders
for discussion after reaching a stalemate in the discussion
between the ministry and the special team.
The board of leaders agreed with Kuntoro that the government
should revoke Pertamina's right to grant contracts, which would
be replaced by government-awarded business licenses.
Most members of the special team objected to the agreement,
insisting the government should give Pertamina the right to award
the oil and gas business licenses. (02)