2011 Oil and Gas Revenue Sharing

Ministry of Finance Regulation No. 68/PMK.07/2011 on 2011 on the Allocation of Forcasted Oil and Gas Mining Revenue Sharing (“Regulation”) has been issued to implement Article 27 (5) of Government Regulation No. 55 of 2005 on Fund Balance

The allocation of the oil and gas revenue sharing, pursuant to Article 1 (1), is still a prediction. In addition, Article 1 (2) states that the allocation prediction will be distributed based on oil and gas revenue realized during the current working year.

Furthermore, the allocation prediction is drafted based on Law No. 10 of 2010 on the 2011 State Budget. It is set at IDR 28.694.951.967.000,00. From that predicted amount, 15.5 percent is allocated to oil revenue sharing, which is set at IDR 16.137.703.258.000,00. A half percent of it, or IDR 513.080.376.000,00, is allocated to the primary education budget,

Moreover, pursuant to Article 2 (2) (b), revenue sharing for gas mining, is set at IDR 12.557.248.709.000,00, or 30.5 percent. Like the oil revenue sharing, half a percent of gas revenue sharing, or IDR 199.032.759.000,0, is allocated to the primary education budget

Pursuant to Article 3 (1) oil and gas revenue sharing will be distributed quarterly to each region. Revenue sharing, pursuant to Article 3 (4) will be conducted using a data reconciliation mechanism between the government and regional government.

The Regulation has one appendix, which consists of the allocation of predicted oil and gas revenue sharing for each region.

For example, Nanggroe Aceh Darussalam province received IDR 82.057.600.000,00 from oil revenue sharing, and IDR 318.942.904.000 from gas revenue sharing. However, there are no allocations for the primary education budget in the Nanggroe Aceh Darussalam province and the regent/city within, from the total revenue sharing.

One of the regions that allocates part of the budget for primary education is North Sumatera province. It received IDR 3.897.517.000 from oil revenue sharing, of which IDR 125.709.000 is allocated to the primary education budget. Moreover, the North Sumatera province also received IDR 6.517.809.000 from gas revenue sharing, of which IDR 106.831.000 is allocated to the primary education budget.

Not every region received oil and gas revenue sharing, since many regions do not produce either substance. For instance, Bangka Belitung and South Kalimantan provinces do not receive gas revenue sharing.

The Regulation has been in force since 5 April 2011.