Critics: SKK Migas? Duties Should Pass to Pertamina

Rimba Supriyatna, IGAP Trisnajaya

When the Government attempted to remedy the BP Migas dissolution by establishing a Special Work Unit for Upstream Oil and Gas Activities (SKK Migas, see ILB No. 2077), many believed that it is Pertamina—a state-owned oil and gas company—that should be managing the upstream oil and gas activities.

Critics say that SKK Migas is no different from BP Migas because the Government did not fundamentally change SKK Migas from BP Migas. It is merely the same agency with a different name.

SKK Migas was established as the successor of BP Migas with the issuance of Government Regulation No. 9 of 2013 on Management of Upstream Oil and Gas Activities on 14 January 2013.

Marwan Batubara, Executive Director of Indonesia Resource Studies, at a discussion on “Oil and Gas Industry Liberalization in Indonesia”, Tuesday (29/1), proposed that Pertamina should resume the management of the upstream oil and gas activities, because it had the managing role before—prior to the issuance of Law No. 22 of 2001 on Oil and Gas.

“Considering the current condition, the Government must appoint Pertamina to manage upstream oil and gas activities through a Government or Presidential Regulation,” stated Marwan.

He argued that Article 33 of 1945 Constitution mandates that the management of upstream oil and gas activities must be carried out by a state-owned company. Thus, Pertamina is more suitable to succeed BP Migas than the newly established SKK Migas.

Marwan recognized that some may object to the idea of returning the management authority to Pertamina, recalling its bad track record. However, Marwan underlined that at that time, Pertamina was influenced by political interests.

“Even though there was much corruption within Pertamina, it was because of the interests of the ruling power,” stated Marwan.

Imran Mustafa, Senior Officer of International Relations at Pertamina, commented to hukumonline that the Government must re-establish a strong regulatory framework on management of upstream oil and gas activities and only then it should return the management authority to Pertamina.

Furthermore, Imran highlighted that Pertamina must be independent and that the Government must not intervene.

Imran concluded that many countries are successful in managing the upstream oil and gas activities through stated-owned companies, giving the example of Petronas in Malaysia.

(jt/hot)

Rimba Supriyatna, IGAP Trisnajaya

When the Government attempted to remedy the BP Migas dissolution by establishing a Special Work Unit for Upstream Oil and Gas Activities (SKK Migas, see ILB No. 2077), many believed that it is Pertamina—a state-owned oil and gas company—that should be managing the upstream oil and gas activities.

Critics say that SKK Migas is no different from BP Migas because the Government did not fundamentally change SKK Migas from BP Migas. It is merely the same agency with a different name.

SKK Migas was established as the successor of BP Migas with the issuance of Government Regulation No. 9 of 2013 on Management of Upstream Oil and Gas Activities on 14 January 2013.

Marwan Batubara, Executive Director of Indonesia Resource Studies, at a discussion on “Oil and Gas Industry Liberalization in Indonesia”, Tuesday (29/1), proposed that Pertamina should resume the management of the upstream oil and gas activities, because it had the managing role before—prior to the issuance of Law No. 22 of 2001 on Oil and Gas.

“Considering the current condition, the Government must appoint Pertamina to manage upstream oil and gas activities through a Government or Presidential Regulation,” stated Marwan.

He argued that Article 33 of 1945 Constitution mandates that the management of upstream oil and gas activities must be carried out by a state-owned company. Thus, Pertamina is more suitable to succeed BP Migas than the newly established SKK Migas.

Marwan recognized that some may object to the idea of returning the management authority to Pertamina, recalling its bad track record. However, Marwan underlined that at that time, Pertamina was influenced by political interests.

“Even though there was much corruption within Pertamina, it was because of the interests of the ruling power,” stated Marwan.

Imran Mustafa, Senior Officer of International Relations at Pertamina, commented to hukumonline that the Government must re-establish a strong regulatory framework on management of upstream oil and gas activities and only then it should return the management authority to Pertamina.

Furthermore, Imran highlighted that Pertamina must be independent and that the Government must not intervene.

Imran concluded that many countries are successful in managing the upstream oil and gas activities through stated-owned companies, giving the example of Petronas in Malaysia.

(jt/hot)

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