OIL HOLDING FIRM CAN BE FORMED AFTER REVISION OF OIL LAW

by Andi Abdussalam

Jakarta, March 1 (Antara) - The plan to establish a state-owned oil and gas holding company has been discussed for more than two years, but it has not been carried out till date.           A holding company will make state-owned oil and gas firm Pertamina more efficient as it will eliminate the overlapping of its tasks with that of the state-owned gas distributor company (PGN).        According to Minister of State-owned Enterprises (SOE) Rini Soemarno, Pertamina would be made an oil and gas holding company and PGN would become its subsidiary.           Without a holding company, the development of gas pipeline network will see an overlap in work. But with a state-owned holding company, there will be only one authority to implement the policy.           The presence of a holding firm for oil and gas will make it easier to put in place oil and gas policies in the upstream and downstream areas. As of now, the policy for upstream areas is different from that for the downstream ones.

HOLDING COMPANY MUST IMPROVE PEOPLE'S WELFARE

by Andi Abdussalam

Jakarta, May 31 (Antara) - The government is planning to establish a number of holding companies for state-owned firms (BUMN) in certain business sectors, such as in the areas of toll road construction, finance, health and energy.          Companies operating in each of these sectors will respectively have their own holding companies. However, an economic law expert has warned that the holding companies should operate based on the 1945 Constitution as per which priority should be given to improving the welfare of the Indonesian people.          One such government-established holding company is state-owned oil and gas firm Pertamina which will serve as a holding company in the energy sector.          Economic law expert Juajir Sumardi advised that the establishment of Pertamina as a holding company in the energy sector, particularly oil and gas, should be based on the amended 1945 Constitution.          Moreover, oil and gas are a natural wealth and must be used in people's interest. These resources should be exploited to make the people more prosperous.          "Oil and gas are strategic natural resources and the state has the authority over them in Indonesia," Juajir, chairman of the Economic Law Study Center of the Makassar-based Hasanuddin University,  pointed out at a national seminar at the Pertamina building here on Tuesday.

HOLDING FIRM NEEDED TO IMPLEMENT ECONOMIC PACKAGES

by Andi Abdussalam

Jakarta, May 9 (Antara) - The government needs to establish holding companies as per its plan in order to implement President Joko Widodo's economic policy packages, particularly in the energy sector.          "The economic policy packages could not be implemented because there is no company which can serve as a 'moderator' for the program. Therefore, the establishment of a holding company for state-owned companies (BUMN)  in the energy sector is urgently needed. If possible, it should be established before August 17, 2016," Achmad Widjaya, the deputy chairman for upstream committee of the Indonesian Chamber of Commerce and Industry (Kadin), said in Jakarta on Monday.          The government, since September last year, has issued 12 tranches of economic policy packages. Three of these economic policy packages needed to be implemented on priority as these dealt with refinery plants, new and renewable energy, and gas conversion for motor vehicles.          Implementation of these packages is delayed for want of a 'moderator'. If formation of a holding company is put on hold, these packages would not be implemented anytime soon, according to Widjaya.