Immediate Change In Oil Policy Called For

Malang, East Java, Oct 7 (Antara) - The government is urged to change its oil and gas policy immediately otherwise the country would face energy crisis in a number of years to come, an observer said. Oil and gas observer Marwan Batubara said here on Monday the country`s oil reserves have been dwindling fast. "Currently our known oil and gas reserves are only around 4 billion barrels," Marwan said, telling students of the state owned Brawijaya University. "Unless the government changes its policy, the country is feared to face energy crisis in number of years to come," he stated. He said the government has to carry out explorations in areas potential to have oil and gas reserves and expanded the program to covert oil fuel with renewable energy sources. In addition, subsidies provided for oil fuels should be used to develop renewable energy, he said. "It is true that the cost of producing renewable energy such as ethanol or bio-fuels is largest than fossil energy cost," he said. He said around US$1.1 to US$1.2 are needed to produce a liter of ethanol against only US$0.6 for oil fuel. However, the government has no choice but to start taking concrete step toward adoption of new oil policy. The subsidy of Rp205 trillion on energy every year should be used partly to develop renewable energy. He said every year the number of motor vehicles rose requiring an increase in supply of oil fuels. The number of new motorcycles hitting the streets in the country averages 7 million to 8 million and new cars 1.2 million units per year. Rising demand for oil fuels has contributed to the deficits in the country`s balance of trade and balance of payments as well state budget, he said. He said currently renewable energy makes up only 5-7 percent of the country`s energy consumption falling short of the target of 10 percent to be raised to 17 percent in 2020. "Under the prevailing condition, I don`t believe we would be able to reach the target as until now program for development of renewable energy is not clear," he said. He also urged the government to provide "oil fund" as an investment for explorations for new oil reserves. Marwan pointed out East Timor as a newly independent country, already had oil fund at Rp20 billion and Norway has Rp500 billion in oil fund. "Indonesia has no such policy yet. The government, therefore, should change its policy related to the need for oil fund, the use of oil fuel subsidy for development of renewable energy and explorations of potential oil and gas reserves," he said. The largest known oil reserves in the world at presents are found in Saudi Arabia, Venezuela and Iran totaling 300 billion barrels as against Indonesia`s 4 billion barrels. Meanwhile, political communication expert Effendi Ghozali said on the same occasion the state suffers a potential losses of Rp7,200 trillion every year from the mineral resource sector. "Our state budget is valued only a little more than at Rp1,000 trillion. Just imagine, how rich the country could be that its losses are more than 7 times larger than its state budget," he said.