Oil and Gas - Export and Import Provisions

The premise of Regulation No. 42/M-DAG/PER/9/2009 is that Indonesia’s oil and gas reserves are a non-renewable strategic natural resource while simultaneously being a vital commodity that plays a critical role in the national economy. Consequently, the national management of oil and gas resources must be done is such a way that it provides the greatest possible benefit to the citizens of Indonesia.

To this end, the government, through the Minister of Trade, has determined an export and import policy that ensures supply. The policy takes in to consideration the oil and gas needs for national business activities.

The oil and gas resources and manufactured derivatives are listed in the Attachment to the regulation. These include among others:

The regulation requires that before any exports or imports are authorized the Minister of Energy and Mineral Resources / Director General of Oil and Gas must consider the domestic needs of Indonesia, then a recommendation is to be issued which states explicitly what types of oil and gas may be exported or imported and in what quantities.

The entities that can make an application are listed in Article 2. These include the Executive Agency, companies, permanent business entities, and direct users. The ultimate approval for any export or import will be made by the Minister of Trade / Director General of Foreign Trade at the Department of Trade.

The application is to be written and include the following documents:

Once a completed application has been received, then approval will be granted within seven working days.

Once the approval to export or import is granted, then the exporter or importer of the oil and gas products are to report in writing to the Director General of Foreign Trade and the Director General of Oil and Gas within 15 days of the approved export or import taking place.

The sanctions for misuse of any approval granted or failure to report as required will see the exporter or importer penalized by being excluded from the next period of exports or imports.

The regulation provides that the Director General of Foreign Trade and the Dircetor General of Oil and Gas may establish an Evaluation Team for the Exports and Imports of Oil and Gas.

Any further regulations required in relation to the implementation of this regulation are to be issued by the Director General of Foreign Trade.

The regulation revokes Minister of Industry and Trade Decision No. 558/MPP/Kep/12/1998 as severally and finally amended by Minister of Trade Regulation No. 01/M-DAG/PER/1/2007 and Minister of Trade Regulation No. 01/M-DAG/PER/1/2008.