The Publish What You Pay (PWYP) Indonesia Coalition has highlighted the swift action taken by the Indonesian House of Representatives (DPR) in processing the Oil and Gas Bill (RUU Migas). The PWYP Indonesia Coalition believes that, amidst the uncertain geopolitical situation and the threat of a climate crisis, this bill should not be merely an administrative instrument but rather a solution to national energy vulnerabilities.
For your information, following the Legislative Body (Baleg) meeting with Commission XII on Monday, April 13, 2024, the DPR is now preparing to form a Working Committee (Panja) to discuss the total replacement of the old Oil and Gas Law.
Allegations of Procedural Flaws and Lack of Transparency
The Indonesian Parliamentary Center (IPC) strongly criticized the status of this bill, which was not included in the National Legislation Program (Prolegnas), but was forced through as a DPR initiative proposal.
“Legally, the Law on the Establishment of Legislation (UU P3U) requires every bill to go through the National Legislation Program (Prolegnas). Forcing the Oil and Gas Bill through the open, cumulative process without transparent urgency sets a bad precedent. The House of Representatives (DPR) should focus on completing the Climate Change Control (PPI) and New and Renewable Energy (EBET) bills, which already have clear mandates in the Prolegnas,” asserted IPC researcher Arif Adiputro in a written statement on Wednesday, April 22, 2026.
Net Importer Status Amid Geopolitical Conflict
Aryanto Nugroho, National Coordinator of PWYP Indonesia, emphasized that the Oil and Gas Bill must incorporate a concrete vision for energy sovereignty. Indonesia has been a net oil importer since 2008, with consumption reaching 1.5 million barrels per day, while reserves continue to decline.
“The current uncertain situation caused by the conflict in the Middle East demonstrates how fragile our energy security is. The Oil and Gas Bill must not only focus on attracting upstream investment, but must also address how we can reduce our dependence on imports. If this bill is not aligned with the fossil fuel reduction and energy transition agendas, Indonesia will continue to be caught in the crossfire of global energy price shocks,” said Aryanto.
Synchronization with the Energy Transition and Climate Justice Agenda
PWYP Indonesia urges that the Oil and Gas Bill must not be a standalone measure but must align with the energy transition and climate justice agendas. The Oil and Gas Bill must appropriately position the oil and gas sector amidst the threat of an energy crisis, but also must not further increase Indonesia’s dependence on fossil fuels.
For example, the articles on carbon capture and storage management in the Oil and Gas Bill should not be used as a shield for oil and gas companies to continue production without a clear net-zero emission commitment.
Meanwhile, the Indonesian Center for Environmental Law (ICEL) highlighted the inconsistency
of the Oil and Gas Bill, which prioritizes an extractive paradigm that contradicts national climate commitments. The bill prioritizes upstream oil and gas activities over other land use interests, including protected forest and conservation areas.
Furthermore, this regulation risks prolonging dependence on high-emission fossil fuels, particularly natural gas, which has high methane concentrations. Methane gas, however, has a strong environmental impact. The omission of methane emission controls in this draft demonstrates that the Oil and Gas Bill is inconsistent with national emissions reduction ambitions and the climate justice agenda, which should prioritize total decarbonization.
“Indonesia’s dependence on fossil fuels amidst current global geopolitical fluctuations emphasizes that energy security can no longer be narrowly defined as simply meeting supply. The Oil and Gas Bill must go beyond increasing upstream production by integrating a concrete energy transition strategy aligned with national climate commitments. This is crucial given the significant risk of methane emissions from the gas sector. Without strong synchronization between oil and gas regulations and the climate justice agenda, Indonesia risks being vulnerable to global market shocks and losing momentum in building more sustainable energy independence for future generations,” said Sylvi, a researcher at ICEL.
Transparency and Accountability
The Oil and Gas Bill must address the current challenges of the oil and gas and energy sectors, including governance issues, particularly transparency and accountability, and the high vulnerability to corruption in governance practices. The Oil and Gas Bill must emphasize the importance of public access to information on documents and the process of awarding cooperation contracts, while respecting the interests of the parties, as stipulated in Article 17 of the Public Information Disclosure Law. The bidding and contract awarding processes are encouraged to be more transparent and fair, with the government expected to provide open arguments to the public at every stage as a basis for its decision-making.
Corruption Vulnerability vs. Policy Makers’ Fear
Regarding institutional strengthening through the Special Oil and Gas Business Entity (BUK Migas), PWYP Indonesia issued a serious note. Aryanto highlighted the recent arrests of numerous energy sector officials by law enforcement.
“We see a paradox: on the one hand, this sector is highly susceptible to corruption due to the massive turnover of money, but on the other hand, there is the risk of potential “criminalization,” which could deter officials from making strategic decisions. The Oil and Gas Bill must provide a solution in the form of a strong system of checks and balances, not simply provide legal protection that could potentially lead to immunity,” he stressed.
Aryanto also criticized the plan to grant BUK Migas the authority to collect PNBP directly as stipulated in Article 48 of the draft bill.
“PNBP must go directly to the state treasury to avoid potential leakage. The BUK must not become a ‘state within a state’ or become a new breeding ground for corruption. Transparency of beneficial ownership in every oil and gas cooperation contract must be an absolute requirement under this bill to prevent conflicts of interest,” he stressed.
Oil and Gas Funds for the Future
Regarding the Petroleum Fund, the Coalition is pushing for the fund to be used not only for fossil exploration, but also specifically allocated for renewable energy development and energy diversification.
“The Oil and Gas Fund must be managed accountably. We don’t want this fund to be used to finance dependence on oil, while the world is already moving towards clean energy. This fund is meant to be a transitional fund, not a tool to prolong the life of fossil fuels indefinitely,” Aryanto concluded.
For your information, based on the draft received by this coalition, the Oil and Gas Bill consists of 30 main points of regulation which are changes and additions to the substance of the current law.
This bill contains more chapters and articles than the current Oil and Gas Law, which has 20 chapters comprising 104 articles. The Oil and Gas Law, meanwhile, only has 14 chapters comprising 68 articles.
Source: Kedai Pena