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The
local shipbuilding industry expects its currently idle shipping
capacity, which has now reached about 50 percent, to be fully exploited
under a new government rule that requires the oil and gas sector to
rely on Indonesian vessels for its shipping needs.
Industry Ministry director for maritime and engineering Soerjono, who
like many Indonesian uses only one name, has said the new rule would
allow the industry to recover next year from the negative impacts of
the financial crisis which started to hit the industry in the second
half of last year.
Soerjono said under the new rule, production sharing contractors in the
oil and gas sector could reclaim expenses made for renting vessels to
support their operations as long as the vessels were constructed in
Indonesia.
He further explained that these shipping expenses would be eligible
items as part of the oil and gas cost recovery scheme to be reimbursed
by the government on the approval of the upstream oil and gas regulator
BPMigas.
"BPMigas has the authority to request PSCs to hire locally produced
vessels if they want to recover costs they spend (on vessels for their
operations)," Soerjono told The Jakarta Post recently.
A memorandum of understanding for the implementation of the new rule,
based on the 2008 Maritime Law, was signed by the Industry Ministry and
BPMigas last month, he said.
Iperindo chairman Harsusanto previously said it was estimated that the
industry could benefit by up to 20 percent of US$1.5 billion in average
annual charter costs spent by oil and gas contractors.
According to ministry data, at present there are 631 vessels comprising
541 national-flag vessels and 90 foreign-flag vessels working in
support of the sector. Prior to the amendment of the maritime law,
which introduced the local shipping quota, foreign operators once
controlled 90 percent of vessels operating in Indonesian waters.
Echoing Soerjono, Indonesian National Shipbuilding Industry Association
(Iperindo) secretary-general Wing Wirjawan said he expected "as much as
possible" to benefit from the MoU.
He said the domestic shipbuilding industry was able to build almost all
20 types of vessels needed by oil and gas contractors, for example
anchor handling tugs, tug boats, mooring boats, barges and utility
vessels.
"What we are incapable of is to build FSOs *floating storage and
offloading facilities* and FPSO *floating production, storage and
offloading facilities*. They are too big at this time. Our shipbuilding
production facilities are not *big* enough yet," he told the Post.
He said the domestic industry would be able to start producing FSOs and
FPSOs with a capacity of between 300,000 and 400,000 dead weight tons
within three to four years at the shipyards being developed at Lamongan
in East Java.
Currently, China, Japan and South Korea are the main countries able to build these facilities.
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