Senator Filep Calls for SKK Migas Economic Model to Clarify Transparency of 10% Participating Interest

07 September 2026 oleh admin

West Papua, dpd.go.id – Member of the House of Regional Representatives of the Republic of Indonesia (DPD RI) representing West Papua, Dr. Filep Wamafma, believes that the issue surrounding the 10 percent Participating Interest (PI) in the management of the Tangguh Working Area (WK) must immediately be clarified and made transparent by the central government, the Special Unit for Upstream Oil and Gas Business Activities (SKK Migas), and all relevant stakeholders.

According to Filep, Tangguh is one of Indonesia’s largest and most strategic natural gas projects. Therefore, the issue of the 10 percent PI is not merely an administrative matter between the regional government and the contractor, but concerns the economic participation rights of the resource-producing region as well as the future fiscal position of West Papua.

At the same time, Tangguh’s LNG production capacity reached approximately 11.4 million tons per year following the operation of Train 3. Tangguh is also entering a new development phase through the Ubadari–CCUS–Compression (UCC) project, with an investment value of approximately US$7 billion and estimated gas resources of around 3 trillion cubic feet (Tcf).

“These figures show that Tangguh is not merely a national oil and gas asset, but also holds enormous economic value for the region where the resources are produced. Therefore, the 10 percent PI deserves to have its legal and economic standing clearly established,” Filep said, as quoted on Monday (September 7, 2026).

As is known, PI provides regional governments, through regionally owned enterprises (BUMDs), with an opportunity to hold a participating interest in oil and gas Cooperation Contracts (KKS) and directly benefit economically from such business activities.

“Therefore, if West Papua does not receive the PI, it is not simply a matter of losing potential revenue today, but also losing the opportunity to build long-term regional economic assets. This requires serious attention, particularly because with the KKS extension running until 2055, the PI could become a source of revenue spanning multiple administrations and generations,” he said.

Filep argued that, from an economic perspective, the value of the PI can be calculated based on cash flow and the economics of the participating interest, taking into account, among other factors, revenues, operating costs, investments, obligations to the state, and financing obligations borne by the entity receiving the PI.

“In this regard, I call on SKK Migas and the Ministry of Energy and Mineral Resources (ESDM) to disclose the economic model for the 10 percent Tangguh PI, so that the people of West Papua can transparently understand the economic value of the 10 percent Tangguh PI, the Net Present Value (NPV) of the PI through 2055, the Internal Rate of Return (IRR), projected cash flows that can be received by the BUMD, financing obligations to be borne by the BUMD, the payback period for the PI investment, the mechanism for distributing benefits among the central government, regional government, and PI holders, as well as which fields and projects are subject to the 10 percent PI,” he explained.

Government Must Clarify the Status of Tangguh PI

In addition, Filep stressed the need for clarity regarding the status of West Papua’s PI rights under the Tangguh KKS, which has been extended until 2055. Minister of Energy and Mineral Resources Regulation No. 37 of 2016 regulates the mechanism for offering a 10 percent PI. The regulation was subsequently amended through Minister of ESDM Regulation No. 1 of 2025, which came into force on January 6, 2025.

In 2022, the government also issued Minister of ESDM Decree No. 223.K/MG.01/MEM.M/2022 as a guideline for implementing the 10 percent PI.

“The extension of the Tangguh KKS was approved in December 2022. Therefore, the government must openly explain whether, during the Tangguh KKS extension process in 2022, the 10 percent PI had been offered to the West Papua regional government/BUMD. And if the process had not been completed, what obstacles have prevented the PI from being realized to this day?” Filep said.

“We must avoid a situation in which the resource-producing region merely bears the social and environmental impacts, while most of the economic value generated by its natural resources flows out of the region. West Papua must receive a proportionate share of the benefits from its natural resources,” he stated.

He emphasized that the 10 percent PI should be viewed as part of efforts to build regional economic self-reliance, in addition to increasing Regional Original Revenue (PAD).

“If managed professionally, transparently, and accountably, the PI can serve as an instrument to strengthen PAD, develop productive regional assets, finance education and healthcare, strengthen infrastructure, enhance the capacity of Papua’s human resources, and create employment opportunities,” he explained.

Indigenous Peoples’ Interests Must Also Be Taken into Account

The Secretary of the MPR RI for Papua also emphasized that discussions concerning the Tangguh PI must involve indigenous communities as holders of rights over territories and resources that, socially and historically, fall within their customary lands.

“Therefore, PI governance must ensure that the economic benefits do not stop at bureaucratic structures or BUMDs, but instead have clear mechanisms for delivering benefits to indigenous communities and affected communities,” he said.

“As a member of the DPD RI representing West Papua, I call on the Ministry of ESDM and SKK Migas to conduct a legal and economic audit of the implementation of the 10 percent PI under the Tangguh KKS,” he added.

According to Filep, the audit should at least address the following issues: First, the status of the 10 percent PI under the extension of the Tangguh KKS through 2055.

Second, whether all provisions of Minister of ESDM Regulation No. 37/2016 and Minister of ESDM Decree No. 223/2022 were implemented during the KKS extension process.

Third, the application of Minister of ESDM Regulation No. 1/2025 to new field developments and Tangguh development activities following the regulation’s entry into force.

Fourth, the economic value of the 10 percent Tangguh PI based on SKK Migas’ official economic model.

Fifth, the parties responsible for the PI offering process, the designation of the BUMD, and the transfer of the PI.

Sixth, the mechanism for ensuring that PI benefits reach indigenous communities and affected communities in West Papua.