Investigation and Criminal Sanction Provisions under the Draft Bill on Oil and Gas

The Draft Bill replacing Law No. 22 of 2001 on Oil and Gas (“Migas”), as amended by Government Regulation in Lieu of Law No. 2 of 2022 on Job Creation (collectively referred to as “Law 22/2001”), is currently under deliberation by the House of Representatives of the Republic of Indonesia (“DPR”). It also introduces provisions on investigations and more stringent criminal sanctions.

“This draft bill contains chapters related to investigations and criminal provisions in the oil and gas sector,” stated Sugeng Suparwoto, the Deputy Chairperson of Commission XII of the DPR.

Compared to the previous Oil and Gas Bill, the system of fines for offenses in oil and gas sector has shifted from fixed nominal amounts to a categorized fine system referring to Law No. 20 of 2025 on the Criminal Procedure Code. The draft bill adopts three main categories of fines for different types of violations, namely Category VI, which applies to violations related to misuse, disclosure, or unauthorized use of survey and exploration data.

Category VII applies to parties conducting General Surveys without authorization, while Category VIII constitutes the highest level of fines, imposed for serious violations such as illegal exploration or exploitation without a contract, fuel adulteration, misuse of subsidies (fuel, gas, and LPG), as well as intentional reduction of quality and safety standards.

Based on the draft Oil and Gas Bill, Civil Servant Investigators (Penyidik Pegawai Negeri Sipil – “PPNS”) are reaffirmed to operate under the coordination and supervision of the police in accordance with applicable provisions. Specific authorities are also granted to PPNS, including the authority to summon experts, conduct searches, and terminate investigations where insufficient evidence exists, in accordance with the latest criminal procedure law.