Foreign Investors leave Indonesian petrol industry

Indonesia map

Foreign investors investors in the oil and gas industry are leaving Indonesia because of the countries “complicated procedures”, as reported in the Vietnam News Agency (VNA).

In their interview with SKKMigas spokesman Elan Biantoro, he said that regulations on payments for land, construction tax, and working age restrictions make it hard for investors to stay in the stay in the country.

Many US companies, including Chevron, are withdrawing their investments. The global oil company dropped a deep-water gas project in the country that was worth USD12 billion.

The loss will not fare well with the country—who, last year, reached the lowest oil output level in 40 years. State-owned gas company Petamina is also taking a hit, as it announced that it’s likely to cut 50% of its capital investment.

The Indonesian Petroleum Association says that the country needs to import 575,000 barrels of oil per day in 2015 in order to meet its needs.

The country currently has eight refineries with a combined capacity of 1.17 million barrels per day. Actual output, though, is only at 800,000 barrels per day.