CONSTRUCTION OF REFINERY COMPLEX {300 BPD}

CONSTRUCTION OF REFINERY COMPLEX {300 BPD}: acquired on June, 2022 that the state owns all petroleum and mineral rights. Foreign firms participate through production-sharing and work contracts. Oil and gas contractors are required to finance all exploration, production, and development costs in their contract areas; they are entitled to recover operating, exploration, and development costs out of the oil and gas produced.

Indonesia’s fuel production has declined significantly over the years, owing to ageing oil fields and lack of investment in new equipment. As a result, despite being an exporter of crude oil, Indonesia is now a net importer of oil Products. It had previously subsidized fuel prices to keep prices low, costing US$7 billion in 2004.

The current president has mandated a significant reduction of government subsidy of fuel prices in several stages.

The government has stated the cuts in subsidies are aimed at reducing the budget deficit to 1% of gross domestic product (GDP) this year, down from around 1.6% last year. At the same time, to alleviate economic hardships, the government has offered one-time subsidies to qualified citizens.