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Journal : Journal of Multidisciplinary Academic Business Studies

Gross split production sharing contracts in the oil and gas business creating imbalance and in justice Syafrinaldi, Rani Fadhila; Suriaatmadja, Toto Tohir; Firman, Chepi Ali
Journal of Multidisciplinary Academic Business Studies Vol. 3 No. 1 (2025): November
Publisher : Goodwood Publishing

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.35912/jomabs.v3i1.3782

Abstract

Purpose: This study examines the implementation of Gross Split Production Sharing Contracts (PSCs) in Indonesia’s upstream oil and gas sector, with particular attention to whether the allocation of rights, obligations, and risks reflects the principles of balance and fairness in contract law. Research/methodology: The research adopts a normative juridical approach using qualitative analysis. Secondary legal materials are analyzed, including oil and gas legislation, government and ministerial regulations, and the contractual provisions of Gross Split PSCs. The analysis focuses on contractors’ obligations related to signature bonuses, firm commitments, and operating costs. Results: The findings indicate that Gross Split PSCs place excessive financial, operational, and technological burdens on contractors, while the government bears minimal risk. Contractors are fully responsible for signature bonuses, firm commitments, and operating costs without cost recovery mechanisms. This contractual structure creates an imbalance of rights and obligations and contributes to contractors’ difficulties in fulfilling firm commitments and achieving agreed production targets. Conclusions: Gross Split PSCs, as currently regulated, do not adequately uphold the principles of balance and fairness. The unequal distribution of risks and obligations undermines contractual justice and the sustainability of upstream oil and gas operations. Limitations: This study is limited to normative legal analysis and does not include empirical field data. Contribution: This research provides theoretical insight into the application of balance and fairness principles in energy contracts and offers practical considerations for improving the Gross Split PSC framework.
Co-Authors Abdullah Assegaf Adithia Maulady Adnan Rafi Al Tahtawi Aghnia Nur Zahrah Agriyani, Fioni Ahmad Sofyan Ahmad Yusuf Aisyah Indah Almira Alma Lucyanti Ambar Susanto Anisa Dyah Lestari Annisa Nurul Sholihah Anwar, Hadrian Arifal Triprasetyo Adi Ashshidiqi, Hasbi Ayu, Aninda Framesti Ratna Azzahra Salsabila Baisrum Baisrum, Baisrum Bambang Puguh Manunggal Bimo Fajrie Alwaaritsi Brian Fadilah Susanto Budi Setiadi Budi Setiadi, Budi Budi Triyono Budi Utomo, Heri Candriansyah, Muhammad Ryan Dandy Nugraha Darwati, Endang Dedi Aming Destri Muliastri Dian Ekawati Diki Diki Dwi Septiyanto, Dwi Endang Habinuddin Fadilah, Rizal Fazrin, Rifki Rizkullah Febi Ariefka Septian Putra Fikri Sofhani Firman, Chepi Ali Habinuddin, Endang Handayani Nur Jamilah Hasan Surya Heni Riswanti Icha Marsya Ramadhani Ichwan Latif Fajari Ilman, Sofyan M. Kartono W. Kasni Sumeru Kumar, Saurav Laras Nurul Syamsy Mauludin, Luthfi Muhammad Melisa Mulyadi Mohamad Firdaus bin Sukri Muhamad Alwi Muhamad Fahmy Muhammad Akmal Muhammad Reihan Iskandar Mujiman Mujiman, Mujiman Muliawan, Rizki MULYONO, NANANG Nabila, Edlyna Syahda Neni Emrida Panjaitan Nisrina Nurul Fadlilah Nuriyadi, Muhammad Nurohmah, Restu Nuryati, Neneng Pramudantoro, Triaji Pangripto Putra, Pahreza Ridwan Putri, Amelia Ocktriviani Rena Reinita Ridwan Solihin Robert Adriaan Philipus Robert Adrian Sapto Prajogo Shodiya Sulaimon Sirait, Togar SISWOYO Sofian Yahya Sophia Latifah Aulia Sri Nugroho SRI UTAMI Sudrajat Sudrajat Sudrajat Sudrajat SUNARTO Sunarto Sunarto Sunarto Sunarto Supriyadi, Tata Supriyanto Supriyanto Suhono Supriyanto Supriyanto Susanto Susanto Suwarno, Ernawati Syafrinaldi, Rani Fadhila Syarif Hidayat Taufik Kurrohman Trisnawiyana Trisnawiyana Trisnawiyana, Trisnawiyana Utomo, Heru Budi Wiguna, Tessa Ananta Wijayanti, Linda Winata, Moh Tomi Yosep Santosa Yoseph Santosa Yudi Prana Hikmat