PWYP Indonesia members conduct training for sub-national stakeholders on revenue sharing calculation and EITI

Source: PWYP Indonesia
Date: 6 Dec 2021

On November 8 2011, PWYP-Indonesia members PATTIRO and LPAW Blora conducted a training event for local stakeholders in Bllora district, central Java, on oil and gas revenue sharing (DBH=dana bagi hasil) calculations and projections. This one day training was attended by the local multi-stakeholder group, the Blora Transparency Team, as well as local government officials, company representatives, local legislators and civil society representatives from Blora district.

Blora is one of the Central Java districts covered by the CEPU Block area, where Mobile Cepu Limited /MCL (subsidiary of Exxon Mobil) has been operating as a contractor as part of a Production Sharing Contract (PSC) scheme.

The training, funded by Revenue Watch Institute (RWI), aimed at deepening understanding of revenue streams, calculation flow and projections of revenue – both from companies to the Indonesia central government, and from central government to local government respectively.

One of the workshop facilitators was Ms Maryati Abdullah, Board Chair for PWYP-Indonesia and one of Indonesia’s national MSG representatives for the EITI implementation process. Maryati provided an overview of the calculation flow and critical variables involved in the calculation of oil and gas revenues, such as lifting, First Trance Petroleum (FTP), Cost Recovery, Entitlement, DMO, oil and gas tax, over/under lifting, signature bonuses, production bonuses and other aspects of oil and gas revenue sharing.

During the training participants also discussed how the EITI report templates/formats for oil and gas in sub-national level would be designed and implemented in the second round of EITI Indonesia reporting.

One of the workshop participants, Mr. Triyanto, from the Blora Office of Revenue, Finance and Asset Management (DPPKAD) remarked: “Training like this is very important for us. I have been following the DBH reconciliation forum in the central government and the calculations seemed very simple, but after joining this training, I feel more confident to ask central government about the calculation and formulation of Revenue from oil and gas that shared by central government to local.”

The training concluded with a series of recommended action points for the local Transparency Team to make projections of Oil and Gas revenue sharing for Blora district from DBH (oil/gas revenue sharing from central government) and the sharing of dividends from participating interest of local government in Cepu Block.