In contracts and/ or contract amendments signed after 1 July 2016, rupiah must be the currency used for settling payments for delivering natural gas through pipelines.
Last year, Eni Muara Bakau BV and its partner signed a gas sales and purchase agreement with state-owned oil and gas company Pertamina. Pertamina will receive 1.4 million tons of LNG.
“The numbers were coming back, the changes were not made by Candra. He asked, ‘what’s your cost structure like"’ That’s all. They [Inpex] brought it up, Mr. Candra corrected them, they said ...
“We must acknowledge that Mr. Arcandra is a great man. We did not know that prices were expensive. But he was able to lower prices. We must applaud that."
Indonesia has been too complacent when it comes to selling large volumes of mining commodities to other countries. This is done when commodity prices are high.
A state-owned holding company for the construction sector would be in breach of KPPU regulations because it provides an opportunity to form a cartel in the sector.
"We are discussing where they can build the fastest. They talked about Bontang. Will Bontang be faster to build, or will it be the one in North Sumatera, we are basically looking into it."
The revision of the regulation revision was one step towards improving the oil and gas industry, which is especially important while global oil prices low.
Both parties are still discussing whether the gas will be distributed through a pipeline or in the form of liquefied natural gas (LNG). They are still waiting for a decision from the EMR Minister.