Requirement for Competitive Oil and Gas Industry

THE MINISTRY OF ENERGY AND MINERAL RESOURCE

REPUBLIC OF INDONESIA

PRESS RELEASE

NUMBER: 612.Pers/04/SJI/2019

Date: October 14th, 2019

Requirement for Competitive Oil and Gas Industry

Minister of Energy and Mineral Resources Ignasius Jonan gave a note in responding to the global challenges of the oil and gas industry. This note should be considered by all stakeholders to make the oil and gas industry competitive.

"The opportunities & challenges are coming not only from regulations, but also from the culture of O&G activities that needs to be adjusted to follow current development" stated Jonan while giving his views at the IDX Channel Economic Outlook with the theme "Creating an Investment Climate in the Oil & Gas Sector" held in JS Luwansa Hotel, Jakarta, Monday (14/10).

In addition to being adaptive to current development, added Jonan, the oil and gas industry should prioritize efficiency for business continuity. Jonan considered this point due to the fluctuating nature of the oil and gas prices.

"Therefore, the one thing that we have to think about is how to create products at competitive prices. The oil and gas industry must be efficient. The world's gas and oil prices are unpredictable, but we have to make better products at competitive costs," he said.

As the backbone of the national economy, it is recognized that the oil and gas industry is facing severe challenges. For this reason, Jonan emphasized that the management of the oil and gas business keep pace with the technology.

Jonan compared this sector to the telecommunications sector which can become very efficient. For instance, the selling price of mobile phones have dropped significantly in the past 25 years. "At that time the price was around Rp. 20 million to Rp. 25 million. Right now an Apple's cellphone costs Rp. 12 million," he explained.

Jonan calculated the current price of cell phone was only 5% of that of a Toyota Kijang minivan. Then, the telecommunications sector has also developed rapidly. It has exceeded the electricity distribution and fuel sectors which have been in this country longer.

According to Jonan, the progress and efficiency of the telecommunications sector should be a trigger for the oil and gas sector management to grow into an efficient and competitive sector. (NA)

Head of Bureau of Communication, Public Information Service, and Cooperation

Agung Pribadi (08112213555)

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