By Ben Otto
JAKARTA--Indonesia will revamp long-outdated oil and gas
contracts, untangle legal problems that have hit companies like
Chevron (CVX) and IM2, and create foreign-friendly incentives as it
seeks to top 8% growth in the coming years, its chief economics
minister says.
The country could also adjust its policy of subsidizing fuel
prices in Southeast Asia's largest economy again this month, Sofyan
Djalil, new coordinating minister for the economy, told The Wall
Street Journal in an interview.
In the past, "we have said to investors, come to Indonesia; but
they come here and their hands are tied, their legs tied," Mr.
Djalil said. "By implementing good policy, we believe we can
attract more investors to Indonesia."
He also said the former OPEC member will revise its decades-old
scheme of oil and gas production-sharing contracts "very soon" to
launch an era of new era of exploration and production--addressing
a major complaint of investors who say the current contracts, which
have their origins in the easy-oil era of the 1960s, don't reflect
the costs of today's riskier deep-water and remote-region
plays.
"We have so much potential is our waters," he said. "But we have
to change the PSC scheme, because the scheme is very archaic
already."
Write to Ben Otto at Ben.Otto@wsj.com
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