Comparative Analysis of Indonesia Gross Split PSC with Fiscal Terms of Several Southeast Asian Countries (Analisis Perbandingan PSC Gross Split Indonesia Dengan Fiscal Term

The implementation of the Gross Split PSC in the upstream oil and gas industry in Indonesia has been running since 2017 with the hope of being able to accelerate the decision-making process and increase attractiveness for oil and gas investors. This study is to analyze the implementation of Indonesia Gross Split PSC compared to other fiscal terms in Southeast Asia region from an economics perspective. The comparisons reviewed are between Indonesia Gross Split PSC and the following fiscal terms: Indonesia Cost Recovery PSC, Malaysia R/C PSC, Thailand Concession, and Vietnam PSC. Fields used as input for analysis are producing oil fields with small-scale recoverable reserves according to RF-2005 / SPE, namely Block X (early production fields) and Block Y (terminated fields). From economics calculations and comparisons, sensitivity and profitability characteristics, specifically applied to the field conditions under review, it is concluded that Indonesia Gross Split PSC has improved economics indicators compared to Indonesia Cost Recovery PSC so that Indonesia Gross Split PSC has an economics level indicator that is better than PSC Indonesia Cost Recovery when compared to Malaysian R/C PSC, Thailand Concession and Vietnam PSC.


I. INTRODUCTION
The petroleum fiscal regime of a country is a set of laws, regulations and agreements which governs the economical benefits derived from petroleum exploration and production [3].
In an effort to increase domestic production, Indonesia faces a number of challenges related to the fiscal term : the risks and costs of exploration, low oil prices, regional competition, uncertainty of the business climate, high tax rates, revenue sharing and FTP determined by a certain amount and applies under any circumstances [1,2,4,8,9].
In response to these challenges and conditions, Indonesia imposed a gross split PSC through Minister of Energy and Mineral Resources Regulation No.8 of 2017 dated January 13, 2017 concerning Gross Split Production Sharing Contracts [6].
After the new regulation is applied, oil and gas business actors need to evaluate Indonesia's new position in the eyes of their business portfolio. After the new rules come into effect, oil and gas business actors need to evaluate Indonesia's new position in terms of their business portfolio. This research was conducted to answer and analyze the attractiveness of Indonesia's fiscal term economic indicators by comparing the PSC Gross Split to the PSC Cost Recovery fiscal term and other fiscal eISSN: 2614-0268 85 pISSN: 2615-3653 terms in the Southeast Asia region : Malaysia, Thailand, and Vietnam. The country of review was chosen because it has remaining reserves equal to 86.35% and oil and gas production levels equivalent to 83.35% of the Southeast Asia region [10 -13]. This research is to answer the question: what is the profile of the upstream oil and gas sector of each country and how the fiscal term position of Indonesia Gross Split PSC is compared with the fiscal term Indoensia Cost Recovery PSC, Malaysia R/C PSC, Thailand Concession and Vietnam PSC in terms of economic indicators including sensitivity, range of %GT and %CT and the nature of the probability.
The fields are small oil production bloks based on Russian Ministry of Naturral Resources. 2005 criteria, with condition as given in Table 1 [7].

II. METHOD
Work flow is shown in Figure 1. The work procedures are as follows: 1. Compiling profiles of the upstream sectors of Indonesia, Malaysia, Thailand and Vietnam to find out the upstream sector figure and the details of the applicable fiscal term rules (Tables 2 and 3). 2. Arranging the fiscal term calculation model refers to the fiscal formula in each country in the Microsoft Excel format, including completing the parameters needed to be able to calculate the economy. 3. Compile economic input data including but not limited to production profile, capital expenditure, and operating costs. 4. Perform economic calculations for each block using countries fiscal terms at the following sensitivity levels: a. oil prices: $ 50, $ 75, $ 100; b. operating costs: -20%, 0, + 20%; c. oil production: 90%, 100%, 110%. 5. Comparing the results of economic calculations (NPV, IRR, POT), sensitivity analysis, range %GT & %CT, and the nature of profitability analysis.

III. RESULTS AND DISCUSSION
The review countries turned out to have a ratio of remaining proven reserves of oil divided by oil production are under 10 years, with Vietnam (6.9 years) in the most vulnerable position to the sustainability of domestic oil production, followed by Indonesia (8.3 years), Thailand (8.5 years) and Malaysia (8.5 years). 8.9 years). While in terms of gas, all review countries have proven gas reserves divided by gas production over 10 years with Thailand (12.3 years) having the lowest ratio, followed by Malaysia (12.4 years), Indonesia (17.9 years), and followed by Vietnam (33.7 years).
All countries faced the same challenges, how to be able to increase investment by attracting investors, promoting exploration and the challenges of managing existing mature fields, as given in Table 4. Simulation results using Block X with cumulative production of 16.2 MMBO is given in  (Figure 3).
The simulation results for Block Y with cumulative production of 11.6 MMBO are given in Table 7. Based on the results, several statements can be made as follows: 1. The economic level of NPV, IRR and MARR (>12%), the order of attraction for investments is: Indonesian Gross Split PSC, Indonesia Cost Recovery PSC, Malaysian PSC and Vietnam PSC. While the Thailand Concession may not as the investment choice even though the NPV value is the greatest but the IRR is below MARR. 2. Vietnam PSC from the NPV is most sensitive to changes in oil prices and the Thailand Concession is most sensitive from the IRR and the Indonesian Cost Recovery PSC from the POT. The Vietnam PSC is the most sensitive to changes in production costs in terms of NPV, IRR and POT. In terms of sensitivity to fluctuations in oil production, Vietnam PSC is the most sensitive in NPV and POT, Indonesian eISSN: 2614-0268 86 pISSN: 2615-3653 Cost Recovery PSC is most affected in IRR (Table 8). 3. The range of% GT and% CT, the Indonesia Gross Split PSC give maximum of 11.62% better %CT compared to Indonesia Cost Recovery PSC at 7.63%. The biggest opportunity for CT% is in the Thailand Concession, which can reach 18.75%, while the Malaysian R/C PSC is at a maximum of 9.53% and Vietnam PSC is 8.42% (Figure 4). 4. From the profitability nature of the fiscal term economic model, the result same as Blok X result ( Figure 5).

IV. CONCLUSIONS
Based on the discussion presented above, several conclusion obtained as follows: 1. Indonesia, Malaysia, Thailand and Vietnam have oil reserves/production ratios less than 10 years, while gas reserves / production ratios are over 10 years. All face the challenge of promoting exploration to find new potentials in both the mature and the frontier areas, as well as the challenges of dealing with existing mature fields.         Figure 5. Block Y -Nature of Profitability