Tender Procurements and Contract Opportunities Indonesia

               JAKARTA. Relevant draft government regulation on cost recovery and the field of Income Tax Provisions Upstream Oil and Gas, Ministry of Energy and Mineral Resources and Minister of Finance to the Working Meeting with Commission VII of DPR RI, Thursday, (18 / 2).

RPP contains special provisions in the field of oil and natural gas primarily about cost recovery for calculating the results as well as for taxation. RPP is compulsory basis kotrak cooperation in the field of oil and natural gas.

The main principle in setting the RPP on Operating Costs of return (cost recovery) and the Income Tax Provisions in the Field of Upstream Oil and Gas, including,

   1. RPP contains special provisions in the field of oil and natural gas, mainly on cost recovery for calculating
       the results as well as for taxation.
   2. RPP is required as basis for cooperation in the field of contract oil and natural gas.
   3. All the indirect taxes including local tax and retribution is part of the operating co
       sts.
   4. Standards / Norms and Methods imposition of fees in this particular provision is a combination of the
       Income Tax Act and ketetentuan Exhibit C current.
   5. Restrictions in full charge of this RPP adjusted to the principles of fairness and business tax provisions.
   6. The fees charged are not allowed on the cost recovery is a combination of Income and ketebntuan
       Minister of Energy and Mineral Resources Regulation No. 22 of 2008 currently in force.
   7. Other income (by product) is a reduction of cost recovery.
   8. Farm-in transaction farm out and uplift the final tax due.
   9. In some cases (special), the Minister of Finance in coordination with the Minister of Energy and Mineral
       Resources may appoint third parties to verify the financial and technical.
  10. Contractors are required to conduct their transactions in the country and settle the payment through the
       banking system of Indonesia.

Cost Recovery is the cost of operation within the framework of operations that include oil exploration, development and exploration of oil and natural gas that can be restored within the framework of the cooperation contract. (SF) (ESDM)

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