JAKARTA: Revenues from oil and gas sector this year are predicted to decrease down to 61.6% after the government and the House of Representatives agreed on Indonesia oil price assumption in 2015 revised budget of US60 per barrel.
The meeting between the Ministry of Energy and Mineral Resources and the Commission VII of the House of Representatives agreed on the Indonesia Crude Price (ICP) of US60 per barrel.
To anticipate the decreasing revenues from oil and gas sector the government was asked to reduce spending or issue bonds.
Acting Director General of Oil and Gas for the Ministry of Energy and Mineral Resources I.G.N. Wiratmadja said the oil and gas sector revenues this year are predicted to only reach approximately IDR126 trillion down 61.64% from 2015 State Budget target which set at IDR327 trillion.
“The decline in ICP assumption influences state revenue” he said after a meeting with Commission VII of the House of Representatives here the other day.
According to him any reduction of ICP by US1 per barrel it will affect the decline in state revenues of more than IDR3 trillion. The government couldn’t do much because the current world oil price continues to decline.
The same thing was said by Deputy of Finance Control for the Special Task Force of Upstream Oil and Gas Business Activities (SKK Migas) Budi Agustiono. The oil and gas revenue this year is expected to only around US11 trillion to US12 trillion or IDR137 trillion to IDR150 trillion.
“Logically the revenue is calculated based on the assumption of oil and gas lifting ICP and investment costs ” he said.
Oil lifting assumption was reduced from 900000 barrels per day (bpd) in 2015 state budget to 825000 bpd in 2015 revised state budget. ICP was revised from US105 per barrel to US60 per barrel.
Meanwhile the amount of cost recovery is expected to decrease in line with decreasing oil lifting target. However Agus could not mention the amount of decrease in cost recovery.
