The regulation, announced earlier by President Prabowo Subianto, requires state-owned enterprises (SOEs) to become sole exporters of several natural resource commodities, including palm oil, coal, and ferroalloys.
"Based on my knowledge, in-depth research, and objective information, the President has decided that the regulation does not apply to the upstream oil and gas sector," Bahlil stated here on Wednesday.
The exception is due to the fact that the majority of upstream oil and gas sales are intended to meet domestic demand, he added.
Upstream oil and gas exports are also subject to long-term contracts and agreements between the government and business entities prior to the Plan of Development (POD), he explained.
"For exports, we carry out long-term contracts, and it is almost certain that there will be no transfer pricing or under-invoicing," Bahlil said.
Therefore, Bahlil guaranteed that business processes in the upstream oil and gas industry will continue as usual, without being affected by the new regulation.
This new policy aims to strengthen oversight and eradicate fraudulent practices, including under-invoicing, transfer invoicing, and foreign exchange embezzlement from export proceeds.
It is also expected to optimize tax revenues and state revenues from the management and sale of our natural resources.
By eradicating illegal mining and plantations, as well as fraud in natural resource exports, Indonesia may secure US$150 billion a year, according to President Prabowo.
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Translator: Putu Indah Savitri, Yashinta Difa
Editor: Rahmad Nasution
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