BP Migas Dissolution

Editorial Team

OVERVIEW

As a country that depends on fossil fuels and that has an underdeveloped alternative energy plan, Indonesia has a significant interest in the oil and gas sector. Since the new order regime, revenues from oil and gas sector have formed Indonesia’s economic backbone, particularly during the “oil bonanza” in the early 1980s to late 1990s. Through the early 1980s, more than 50% of the state revenue came from oil and gas sector and it still accounted for 40 percent of spending in 1990 and 24 percent in 2005.[1]

This condition has made Indonesia one of the significant players in the international oil sector. This is illustrated by Indonesia’s membership in Organization of Petroleum Exporting Countries (“OPEC”) from 1962 to 2008 - year when Indonesia left OPEC, after Indonesia became a net importer of oil.