Many issues on oil bill still unsettled: Legislator
Many issues on oil bill still unsettled: Legislator
JAKARTA (JP): The House of Representatives could miss a Sept.
6 deadline in giving its final endorsement on a controversial oil
and gas bill, a legislator has said.
Bahtiar Hamzah, a member of a special team assigned to hammer
out the draft law, said here on Saturday that he was pessimistic
that the bill could be tabled for final approval on Sept. 6 as
scheduled because many thorny issues have not been settled.
"We have agreed on some important issues of the bill. But, due
to the complexity of other substances, I really can't predict
that the bill will be ready for the scheduled plenary session on
Sept. 6," he told a seminar on the new oil and gas bill.
He said the bill was so complicated that controversies on
certain issues still lingered over a highly publicized
deliberation process that has been gone on for over three and a
half months.
The government-sponsored bill, which will, among other things,
remove the monopoly held by the state-owned oil and gas company,
Pertamina, in managing the country's oil and gas sector, has
attracted wide coverage from the local press.
Under the new bill, Pertamina's role to award contracts to oil
and gas contractors will be lifted and transferred to the
government. Pertamina's special status will be also removed and
it will operate as any other limited-liability company.
Legislators are often charged with siding with Pertamina as
they oppose most of the articles, which are not in favor of the
state company.
Hamzah dismissed an allegation about legislators being bribed
that they had strongly opposed some details of the liberalization
program on the gas and oil sector proposed by the government
through the bill, causing delays in the deliberation process.
He said the House and the government were close to reaching an
agreement on the details of the particular clauses dealing with
lifting Pertamina's monopoly in the downstream sector.
But they were still divided about the transition period to be
given to Pertamina to fully comply with the new legislation.
"We ask the government to give Pertamina an up to five-year
transition period not two years as proposed. It is important to
enable Pertamina to improve its performance prior to the removal
of its privileges," he said.
Minister of Mines and Energy Kuntoro Mangkusubroto said on
Friday that legislators and the government had agreed to give
Pertamina two years to become an independent company.
Kuntoro said that after two years becoming an independent
company, the government would give preference to Pertamina to
handle a certain working zone for a maximum of five years as a
transition period.
If Pertamina failed to manage the zone, the license to operate
the zone would be tendered by the government, he said.
Bahtiar said that the legislators also still opposed the
clause which would allow fuel producers to set their own prices.
"We strongly opposed the government's proposal to liberalize
the price mechanism. We're afraid the price will be totally out
of control if we allowed producers to set their own prices," he
said. (cst)