Association of oil and gas, renewable energy legal practitioners formed

The Association of Oil and Gas and Renewable Energy Legal Practitioners (or APHMET) was officially formed on the sidelines of the three-day Oil and Gas Legal Forum (or FHMM) held in Yogyakarta which opened on Monday.

Head of the Legal Division of the upstream oil and gas authority SKK Migas, Didik Sasono Setyadi, who is also the Chairman of APHMET, said that APHMET was created as a communication forum for the legal practitioners to increase competence, professionalism and integrity.

According to Didik, oil and gas will somehow blend and transform towards new and renewable energy. So this newly-formed forum is no longer exclusive only to the upstream oil and gas industry, but also accommodated the needs of legal practitioners in the field of new and renewable energy so that this forum was called the Association of Oil and Gas and Renewable Energy Legal Practitioners (APHMET).

 “For this reason, starting this year and the following years APHMET will become a forum for us to hold the Upstream Oil and Gas Legal Forum and even in the future also the Renewable Energy Legal Forum," said Didik in his opening remarks at FHMM 2023 as quoted in a statement.

Didik said that this year's FHHM theme was "Regulatory and Policy Challenges in the Upstream Oil and Gas Sector in the Era of Decarbonization."

He explained that this theme was chosen because of the increasing urgency of decarbonization policies, especially with the increasingly close application of technology in an effort to reduce carbon emissions through carbon capture, utilization and storage or Carbon Capture Storage (CCS)/Carbon Capture Utilization and Storage (CCUS) in the upstream oil and gas industry.

Apart from discussing these issues, important issues discussed are related to project financing, oil and gas law, renewal of production sharing contracts (PSC), restructuring of the national oil company (NOC), ease of business licensing, overseeing national strategic projects, to business judgment rules, as well as arbitration for dispute resolution would also be important topics discussed in this year's FHHM.

Didik added apart from studies, this year's FHHM will also convey other things that are concrete and real, namely, the launch of the APHMET bebsite and the Oil and Gas Sector Regulation Site, the launch of the APHMET collaboration with the Faculty of Law, Islamic University of Indonesia, as well as the launch of the Establishment of the Energy Dispute Arbitration Board (BASE).

Didik said that the upstream oil and gas industry in the country is one of the oldest industries. In fact, it is much older than the age of this republic. "In the old upstream oil and gas industry, of course, without us realizing it, thousands of reliable and competent oil and gas law practitioners have been born, grown and matured," he said.

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Didik continued, these practitioners really understand the ins and outs of the upstream oil and gas industry since Indische Mijnwet Staatsblad 1899 No.214 jo. Staatsblad 1906 No. 434 during the Dutch Era was implemented, which was then replaced by Law Number 44 Perpu of 1960, even then when Law Number 2 of 1960 concerning Agricultural Production Sharing Agreements inspired the implementation of a scheme that made Indonesia an icon of the upstream oil and gas industry in the world, namely legacy in the form of a Production Sharing Contract (PSC) scheme up to today's modern era.

"Currently, more than 70 countries in the world have adopted Production Sharing Contracts, but it is a shame that when the world wants to study PSC, they don't come to Indonesia, not to UI, UGM, Airlangga (universities) and others, but have to go to Houston or Aberdeen," said Didik.

There must be something wrong with this. In fact, Didik said that there are countless oil and gas law practitioners in Indonesia who have spread to work in other countries.

"Until now, Indonesian oil and gas legal practitioners do not have a forum to collaborate with each other, synergize and contribute more, like our friends in other professions such as IATMI and IAGI," said Didik.

Didik said that to achieve the vision and target of 1 million BOPD by 2030, more than US$20 billion of investment per year is needed, which really requires attractive fiscal and non-fiscal incentives.

"For us legal practitioners, of course these are not just numbers, but there are opportunities, challenges, threats and obstacles that must be faced, managed and utilized," he said.

“You can imagine how many regulations, agreements/contracts, whether in the form of joint ventures (joint operating agreements), project financing, procurement of goods and services, commercial contracts (buying and selling of oil/natural gas/LNG), compliance with the environment (net zero emission), to dispute resolution matters that are inherent in this investment increasing from year to year.”

"And through this forum, it is hoped that we can strengthen the collaboration of Indonesian oil and gas legal practitioners for the progress of the upstream oil and gas industry and renewable energy for the nation's energy security and prosperity," Didik concluded.

Editing by Reiner Simanjuntak