Implementation Of Pcs Cost Recovery VS Gross Split Model In Earth Oil And Gas Cooperation Contracts In Indonesia After Government Regulation Number 53/2017, In Effect To State Revenue

Abstract

At the age of more than 130 years since the findings, oil and gas reserves have tended to decline relatively recently. Every year (2010-2020) there is always a gap between the performance of oil production and oil consumption in Indonesia where oil production cannot cover Indonesia's oil consumption needs, so the rest is forced to import from foreign oil producers. Realization of ready-to-sell (lifting) oil production in the third quarter of 2022 reached 610,100 barrels per day. This achievement is still below the 2022 state budget target of 703,000 barrels per day. The reason for the decline in oil and gas supply is a lack of exploration. The government's decision to change the Production Sharing Contract (PSC) Cost Recovery into PSC Gross Split in the oil and gas cooperation contract scheme is intended to increase the efficiency and effectiveness of production split between the contractor and the government carried out by SKK Migas as stated in the ESDM Minister Regulation No. 8/2017 as amended by Regulation No. 52/2018 and No. 20/2019 concerning PSC Gross Split. After having received a lot of criticism from experts and contractors finally through ESDM Ministerial Regulation No. 12/2020 the Indonesian government changed its policy by imposing forms of cooperation and flexibility in the form of contracts for gross split results or cost recovery. The aim of the research is to evaluate how the implementation of PSC Gross Split is compared with the implementation of PSC Cost Recovery in the oil and gas cooperation contract in Indonesia in effect to State Revenue. The research method used in this research is a descriptive method with the application of comparative analysis. While the research approach used is a qualitative approach. Data collection method uses interview, observation and documentation methods. The author concludes, that the government's policy through ESDM Ministerial Regulation No.12/2020 gives the impression that the government is ambivalent, namely that there is an element of uncertainty in the consistency of government policy in the field of calculating contractor income vs. government revenue which of course this uncertainty will have an impact on tax fairness even an increase in government revenue or revenue can be disrupted due to resistance from other foreign miners who are not given discretionary choices to use the PSC cost recovery method. By considering that the government's decision to use PSC Gross Split is more profitable for the government than PSC Cost Recovery, to reflect the government's commitment to realizing an increasingly condusive and progressive Ease of Doing Business Index in Indonesia in the eyes of investors, rather than the government returning to using the cost recovery model in oil and gas exploration, it would be much better if the government is consistent with implementing the Gross Split model but by providing an extra special incentive as a form of government support in water development considering that projects in deep sea waters carry a very high risk.