Megawati to meet oil corporate leaders in Bogor

The Jakarta Post , Jakarta

President Megawati Soekarnoputri is due to meet on Friday with top executives of oil and gas companies operating in the country amid worrying reports that Indonesia could become a net oil importer in ten years.

During the second Stakeholders Meeting at the Bogor palace, the President is expected to discuss various problems confronting the industry and seek ways to boost investment in the sector.

Industry leaders have welcomed the occasion, expressing hopes that there would be frank discussion during the meeting.

"The industry needs open communication on critical issues facing the country. If we can create venues where difficult issues can be analyzed and debated openly and frankly, everyone should be better off," a senior official of a foreign oil company said.

The first Stakeholders Meeting was held in February last year.

After experiencing a slump in 2002, the government claimed that the industry recovered last year, citing as evidence the rise in the number of oil and gas contracts signed. Last year, the government awarded 16 oil and gas concessions. This was a huge leap from 2002 when the government could only get two contracts -- a new contract and an extension contract -- but was still much lower than in 1997, when the government awarded a total of 28 contracts.

Despite the rise in the number of contracts, critics noted most contracts went to small and medium companies, while giant Western companies remained reluctant to join the bidding.

Rachmat Sudibyo, chairman of oil and gas upstream regulatory body (BP Migas) recently said Indonesia could become a net oil importer in 10 years if there was no increase in the exploration for new oil reserves and the public continued its lavish consumption of oil.