Local Content Intake in Upstream Oil and Gas Hits Rp 39 Trillion

By Editorial Team 13/10/2021
Summary

The Upstream Oil and Gas Regulatory Special Task Force (SKK Migas) has calculated that the total commitment value of the domestic component level (TKDN) in the sector this year is about Rp 39 trillion. "About 58 percent of the TKDN target has been realized, but the total commitment has approximately reached Rp 39 trillion. The number comes from existing and future commitments of oil and gas contractors to be spent on domestic companies," Erwin Suryadi, SKK Migas' head of Supply Chain Management and Cost Analysis Division, said on Tuesday.

Therefore, SKK Migas vows to keep encouraging the upstream oil and gas sector to increase the TKDN commitment due to mutual contributions with supporting industries, worth US$7.13 billion in 2020-2021. However, Erwin insisted that improving domestic producers' ability to manufacture goods meeting specifications demanded by the oil and gas contractors would be equally important. "This is a very important concern, lest the oil and gas industry is developing but its supporting industries do not involve domestic industries," he said.

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