Indonesia’s Elimination of Tax May Increase Oil and Gas Exploration

Although consumers are rejoicing at the recent fall in oil prices, governments as well as oil and gas industry players have watched closely and anticipated the impact lower prices will have on oil and gas exploration activities. In January 2015, the Pacific island country Indonesia has eliminated a land tax that was previously imposed on companies while exploring for oil and gas. The repealed tax will likely be welcomed news to companies like Sentry Energy Production, which provides oil and gas exploration services to its partners. These companies search for potential oil reserves around the world in the interest of helping their clients expand their portfolios in the oil and gas industry.

Image courtesy of num_skyman at FreeDigitalPhotos.net

Ministry Cites Incorrect Interpretation

According to a spokesperson for the tax office of Indonesia’s Finance Ministry, the .5 percent land and building tax was incorrectly interpreted to apply to the area in which companies are exploring for oil. Therefore, the ministry amended the regulation to exclude oil and gas exploration. The ministry clarified that the tax was intended to be levied against companies that actually use Indonesian land; therefore, the regulation should only be applied to oil and gas companies during the production stage.

Field of Opportunity

Indonesian government data indicates that there are 60 hydrocarbon fields in the country with only 16 in production. In addition to the 16 that are in production, 22 fields are currently being explored, seven of which have been found to contain hydrocarbon reserves. In previous years, oil and gas exploration primarily took place in the country’s northwest region, and nearly all oil fields were located under land. However, most of the 22 frontier basins that remain unexplored are located off Indonesia’s eastern shore. Therefore, Indonesia presents numerous opportunities for oil and gas exploration. In an effort to tap into its potential domestic oil reserves, the country stepped up drilling activities in 2014. The increase in drilling marks a possible shift toward a more relaxed policy regarding exploration activities.

A Positive Step Forward

As Indonesia has shifted from having been completely self-sufficient in oil in the past to presently being an importer, the energy ministry has been calling for more tax incentives in the past several years to attract more investment. The American Chamber of Commerce describes the elimination of the land tax as a positive step as oil and gas companies have long called for less regulatory complexity for exploration activities in Indonesia.

Overall, oil and gas exploration companies are expected to respond favorably to the elimination of the land tax in Indonesia. The current state of decreased gas prices has created an environment that is favorable for governments lowering their restrictions on oil and gas exploration to attract investment. Fewer restrictions mean companies may find unexplored basins more attractive and will, therefore, be more willing to explore these areas. Analysts predict other governments in other heavily regulated countries will follow Indonesia’s lead and also lower taxes and remove other potential barriers to oil and gas exploration.

Motorcycle Helmet Act

Remember my brother who had a motorcycle accident last year? He just bought a motorcycle. Grrr!

my brother after his motorcycle accident

It was March last year when my brother, together with a friend and cousin as back riders, had a motorcycle crash. They hit a man who crossed the highway from nowhere. Thank God that the man didn’t suffer from any fatal injuries and is alive. My brother however, was unconscious for almost ten minutes, had bruises everywhere in his body and lost his four front teeth because he was not wearing a helmet. Now that he has fully recovered, alive and kicking, he bought a motorcycle. He even asked me with a devilish smile if I want to back ride. “Thanks but no thanks.” I prefer to walk than ride with him while snaking through narrow paths and along the highway.

It looks like my youngest brother hasn’t learned his lessons yet. He is so stubborn but since we can’t do anything about it because he is old enough and used his own money in buying the motorcycle, I just asked him to buy Shoei Qwest and educate him about the Republic Act No. 10054 also known as the Motorcycle Helmet Act.

If you are a motorcycle rider yet prefer not to wear helmet, you might want to know what are stated in the Motorcycle Helmet Act.

Republic Act No. 10054 – Motorcycle Helmet Act

•All motorcycle riders, including drivers and back riders, are required to wear standard protective motorcycle helmets at all times while driving, whether long or short drives, in any type of road and highway. Standard protective motorcycle helmets are appropriate types of helmets for motorcycle riders that comply with the specifications issued by the Department of Trade and Industry (DTI).

•Any person caught not wearing the standard protective motorcycle helmet will be punished with a fine of P1,500.00 for the first offense, P3,000.00 for the second offense, P5,000.00 for the third offense, and P10,000.00 plus confiscation of the driver’s license for the fourth and succeeding offenses.

•Tricycle drivers are exempted from complying with the mandatory wearing of motorcycle helmets.

•Every seller and/or dealer should make available, every time a new motorcycle unit is purchased, a new motorcycle helmet that bears the Philippine Standard (PS) mark or Import Commodity Clearance (ICC) of the Bureau of Product Standards (BPS) and complies with the standards set by the BPS, which the purchaser may buy at his option. Any seller and/or dealer who violates this requirement will be punished with a fine of not less than P10,000.00 but not more than P20,000.00.

•All manufacturers and importers of standard protective motorcycle helmets are required to secure a PS license or ICC prior to the sale and distribution of their products. Upon the effectivity of R.A. 10054, only those standard protective motorcycle helmets bearing the PS or ICC mark shall be sold in the market.

•The DTI, through the BPS, shall conduct a mandatory testing of all manufactured and imported motorcycle helmets in the Philippines. The BPS shall periodically issue a list of motorcycle helmet manufacturers and importers and the brands which pass the standards of the BPS, to be published in a newspaper of general circulation or in its website.

•Any person who uses, sells and distributes substandard motorcycle helmets or those which do not bear the PS mark or the ICC certificate will be punished with a fine of not less than P3,000.00 for the first offense, and P5,000.00 for the second offense, without prejudice to other penalties under Republic Act No. 7394 or the “Consumer Act of the Philippines.”

•Tampering, alteration, forgery and imitation of the PS mark and the ICC certificates in the helmets will be punished with a fine of not less than P10,000.00 but not more than P20,000.00, without prejudice to other penalties imposed in Republic Act No. 7394 or the “Consumer Act of the Philippines.”

Spread Love and Share Your Blessings in Mindanao

I am back online after several days of being sick. A flu badly hit me. I was down with cough, cold, sore throat, muscle pains and headache. I thought I wouldn’t make it before Christmas but after consulting the doctor and having the chance to see those pretty nurses in their stylish nursing uniforms again, I am now back to work.

It was hard to be down with flu. Every inch of me hurt but what made me feel bad more are these scenes from the news…the victims of typhoon “Sendong” (Washi) that were devastated by rampaging flood waters in Cagayan de Oro and Iligan City. These are truly heartbraking scenes.

riverside community that was devastated by flash flood
homeless children…victims of typhoon Sendong
losing their loved ones…

Everyone was caught by a surprise while they were on deep sleep. Some managed to climb on their roofs and survived but it was too late for many residents most especially the children. They got drowned in the muddy flood. It is the worst flood in Iligan City and Cagayan de Oro.

As of today 957 are reported dead, 47 are still missing and hundreds are injured. Those who survived are now on the evacuation center and some were trying to fix what is left of their homes.

You and me are still lucky to be able to celebrate Christmas with our families in the comfort of our homes. I hope we can spread love and share some of our blessings this holiday season. Let us help the victims of “Sendong” in Mindanao.

Convenient and Fast Way to Raise Cash Donations

Before the election, it is easy to accomplish many projects because politicians were very much eager in extending their help. Now that the election is over, you have to think of great ideas how to make money for the funding of other projects that are still on the process. 

The best way of course to raise cash donations for your cause is through fundraising. However, there are different fundraising options to consider. Fundraising ideas come in variety of sizes and shapes but what you need is an effective way to motivate people to support your project or cause with cash donations. The internet is where most of the people are going now whenever they need something so an online magazine fundraising program where you can tell people about your cause would be great. Magazine fundraisers are very convenient and could raise funds fast. If you don’t know how to start, you can browse the web for the websites that are offering wide variety of fundraiser products and services. These websites could help you set up your own webpage for your magazine fundraising program for free.

What are you waiting for? Don’t waist a single minute. The sooner you start your magazine fundraising program, the sooner you can raise funds for your cause.