Gross Split Scheme is Applied to Oil and Gas Only: Govt

RRI.CO.ID, Jakarta - Indonesian Minister of Energy and Mineral Resources Bahlil Lahadalia emphasized that the gross split scheme applies only to the oil and gas sector. His statement responded to speculation that the government would extend the scheme to the mineral and coal sectors.

The gross split is a production-sharing contract scheme in oil and gas management between the government and production-sharing contractors (PSCs). Under this arrangement, production proceeds are distributed immediately, while contractors bear all operational costs.

“Meanwhile, in the mineral and coal sectors, there are absolutely no changes in regulations,” Minister Bahlil said in Jakarta on Monday, June 8, 2026. He stressed that the mineral and coal sectors remain fully subject to existing rules.

Minister Bahlil explained that the clarification was necessary to prevent misunderstandings among business operators regarding the application of the gross split scheme. He underlined that the policy remains limited to the upstream oil and gas sector as stipulated in current regulations.

He affirmed that regulatory certainty is crucial for maintaining the investment climate and ensuring the sustainability of ongoing mining operations. “To mining business operators, I can confirm that there will be no changes in regulations,” Minister Bahlil stated.

In addition to regulatory certainty, Minister Bahlil highlighted efforts to sustain the national downstream processing program. He said the government is focusing on ensuring the availability of raw materials for smelters that are already operating and those under development.

Minister Bahlil assured that the government is responsible for maintaining a balance between mining commodity production capacity and domestic industrial needs. The preparation and issuance of the Work Plan and Budget (RKAB) will take into account raw material requirements to support downstream investment. (Gusti Panji)