[JAKARTA] The upstream oil and gas industry in Indonesia throughout 2017 has still been quite challenging for oil and gas companies. Although the world oil price has experienced a slight increase, the price has remained relatively low over the last three years and is not predicted to change much up to the end of the year. "On a global scale, the oil and gas companies are also continuing to make changes to their operational activities and investment plans," said the President of the Indonesian Petroleum Association (IPA), Christina Verchere, at the 46th Annual General Meeting 2017, Jakarta on Wednesday 6 December 2017.
Here in Indonesia, exploration activities can be said to have decreased significantly with a lack of participants in the recent working area bid round offered by the Government. "But we have to wait for bid round results that have been extended until 31 December 2017 to see the final outcome," she said.
In addition, based on the National Energy Plan (RUEN) document stipulated in the Presidential Decree (Perpres) No. 22 Year 2017, there are two activities that must be performed to meet the future energy needs of the country, namely: Exploration and Enhanced Oil Recovery (EOR). Therefore, the IPA hopes that the Government of Indonesia can make regulations that are able to attract upstream oil and gas investment into the country.
In early 2017, the Government of Indonesia, in this case the Ministry of Energy and Mineral Resources, issued the Ministerial Regulation (Permen) No. 8 Year 2017 on the Gross Split PSC. This regulation is intended to eliminate the cost recovery mechanism of the PSC Contract between the Government and PSC companies.

After a series of discussions involving the IPA and relevant stakeholders, the Government of Indonesia issued the MR 52/2017 as the improvement on the MR 8/2017. Two significant things changed as is found in MR 52/2017, namely: changes of progressive and variables split, and the opening of incentive limits which the Minister can provide to maintain the economic level of a working area.

Another achievement that is considered significant by the IPA in 2017 is the issuance of GR No. 27 Year 2017 which is a change from the GR 79/2010. Compared to the GR 79/2010, this new regulation does provide some improvements especially for contracts after 2010. But such improvements are not as attractive as the Assume and Discharge principle as for contracts pre-2010.

In addition to being involved in the drafting of regulations, the IPA has also recorded success at the 41st IPA Convention and Exhibition held on 17-19 May 2017, at the Jakarta Convention Center. As part of the event, the IPA also published a series of infographics describing the current condition of the upstream oil and gas industry in Indonesia.

Finally, the 46th Annual General Meeting also introduced the IPA Supervisory Board and the Board of Directors for 2018. The structure of the IPA Supervisory Board and the Board of Directors is shown below:
Supervisory Board
Evita Herawati Legowo 
Board of Directors
President - Ronald Gunawan, MEDCO ENERGI INTERNATIONAL, TBK, PT 
Vice President - Dan L. Wieczynzki, EXXONMOBIL CEPU LTD. 
Vice President - Bijan Agarwal, CONOCOPHILLIPS (GRISSIK) LTD. 
Secretary - Christina Verchere, BP INDONESIA 
Treasurer - Tumbur Parlindungan, SAKA INDONESIA PANGKAH LIMITED
Director - I.Tenny Wibowo, SANTOS (SAMPANG) PTY. LTD. 
Director - Nico Muhyiddin, INPEX CORPORATION
Director - Fabrizio Trilli, ENI INDONESIA
Director - Arividya Noviyanto, TOTAL E&P INDONESIE
Director - Gunung Sardjono Hadi, PERTAMINA (PERSERO) PT – PHE
Director - Charles A. Taylor, CHEVRON INDONESIA
Director - Kevin S. Moore, HUSKY ANUGERAH LTD.
The Supervisory Board and Board of Directors will start working with effect from Dec 6, 2017, supported and assisted by 12 existing committees containing representatives from oil and gas and service companies operating in Indonesia. (PS)
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