For the umpteenth time the Draft Agenda for Amendment to Law No. 22 of 2001 on Oil and Gas (the Oil and Natural Gas Bill) was set as one of the bills included in the 2016 priority National Legislation Program (Prolegnas) Civil Society Coalition Publish What You Pay (PWYP) Indonesia noted that since 2010 the agenda of the Oil and Gas Bill has always decorated the annual list of the DPR RI Prolegnas. The agenda for the Oil and Gas Bill this year is the 3rd (three) year for the House of Representatives for the 2014-2019 period and also marks 12 (twelve) years after the issuance of the Constitutional Court’s decision No. 002 / PUU-I / 2003 which canceled a number of articles in Law Number 21/2001 concerning Oil and Gas and 4 (four) years after the issuance of the Constitutional Court’s decision No. 36 / PUU-X / 2012 which dissolved BP Migas.

The Chairperson of the PWYP Indonesia Steering Board, Fabby Tumiwa, urged the House of Representatives (DPR), especially Commission 7, to immediately discuss the Oil and Gas Bill. To date there has not been any significant development from the discussion of the Oil and Gas Bill, even though, the acceleration of the discussion on the Oil and Gas Bill was not only because the Constitutional Court’s decisions annulled several previous Oil and Gas Law articles, but were related to various issues that demanded a systemic solution, such as energy policy national level which has not supported the vision of energy sovereignty, mafia oil and gas practices, inefficient operational costs and the impact of falling world crude oil prices which reached its lowest point this year.

Fabby who is also Executive Director, Institute for Essential Service Reform (IESR) stated, “The root of various problems in the oil and gas sector is the legal umbrella that still has many gaps, both in terms of planning, management, guidance, and supervision. At least there are several key issues that must be included in the discussion of the Oil and Natural Gas Bill, namely the planning of oil and gas management, the upstream oil and gas institutional model that enables the process of checks and balances; Supervisory Agency, BUMN Management, Petroleum Fund, Domestic Marker Obligation (DMO), Reserve Funds, Cost Recovery, Participating Interest (PI), Protection of the Impacts of Oil and Gas Activities, and Information System Reform and Participation.

Aryanto Nugroho, Advocacy and Network Manager PWYP Indonesia revealed, “Information System Reform and Participation is very crucial to ensure the fulfillment of the rights to public information. Transparency of KKKS Contract openness, DBH calculation, lifting data, sales data, and AMDAL documents must be opened as a form of fulfilling public information rights. In addition, the Oil and Gas Bill must provide a guarantee of participation space to be involved in every stage of the management of the oil and gas sector in Indonesia which is barely fulfilled,”

“The discussion on the Oil and Gas Bill has become increasingly urgent amidst various initiatives undertaken by various parties in pushing for reforms in improving oil and gas sector governance such as the Coordination and Supervision of the Energy Sector (Korsup Energy) initiated by the Corruption Eradication Commission (KPK), oil and gas licensing reforms in the ESDM and BKPM or follow up on the recommendation of the Oil and Gas Governance Reform Team (TRTKM). These initiatives must be supported by reforming the legal umbrella through discussion of the Oil and Gas Bill in the DPR,” added Aryanto.

Ahmad Hanafi, Executive Director of the Indonesian Parliamentary Center (IPC), explained that the way in which the discussion on the Oil and Gas Bill was further complemented the poor performance of the DPR’s legislation which in 2015 only completed 3 Laws. “The Oil and Gas Bill seems to only be a ‘sweet display’ in each Prolegnas compiled by the Parliament without any effort to just discuss it. This has been made worse by the non-scheduled draft of the Oil and Gas Bill as one of the bills that will be completed by the DPR during the fifth session of 2015-2017. ”

“Reflecting on last year, the agenda for discussion of the Oil and Gas Bill in the DPR was almost without news. We think that the slow discussion of the Oil and Natural Gas Bill in the House of Representatives is full of conflicting interests. We must remember that the oil and gas sector is a strategic sector. Many parties are likely to come into play. Therefore, the government and the House of Representatives must be very guarded and ensure that the discussion on the Revision of the Oil and Gas Law is free from rent-seeking mafias who are riding this agenda, “Hanafi explained.

“The Oil and Gas Bill will be completed if the DPR shows its statesmanship by releasing political and economic interests behind it. It is time for the House of Representatives and the Government to show improvement in their legislation performance by immediately discussing this Oil and Gas Bill. It must also be remembered, the agenda for the completion of the Revision of the Oil and Gas Law is one of the Jokowi-JK Government’s commitments to the Nawa Cita agenda of action programs related to improving oil and gas governance, “he added.

Berly Martawardaya, lecturer in Energy and Mineral Economics at the Faculty of Economics at the Universitas Indonesia (FE-UI) said, “Facing the fall in oil and gas prices, the continued decline in oil and gas production and the reduced investment in the oil and gas sector in Indonesia, it is necessary to make a real change in Indonesia’s oil and gas governance. The discussion on the oil and gas bill is a concern that cannot be postponed again. Certainly, the discussion on the Oil and Gas Bill must be carried out with reference to international best practices, national interests, and consultation with stakeholders to revive Indonesia’s oil and gas sector which is currently in decline.”