Indonesia’s natural resources have its own interest in the international community, specifically oil and natural gas. The conduct of nation and state activities and actualization of the prosperity of the people must be landed by a governing law, including the management of oil and natural gas. Oil and natural gas as one of the contributors to the Indonesian Budget (APBN). With open market projects, privatisation, and energy consumption intervention, in this context the state’s mega project is no longer development law politics but natural resource economy occupation, vital economic assets and the control of local markets by foreign companies, therefore globalization poses as a challenge for the government on its authority to manage natural resources, especially non-renewable resources. Natural gas is one of the non-renewable natural resources that controlled by the state. The importance of the use of natural gas, good for development in Indonesia and export needs, also the limited means natural gas itself, so the use of natural gas become important to the government attention. The concept of state sovereignty over the management of oil and natural gas has been raised as a research topic by law graduates because there are still many issues with oil and natural gas management, especially in the field of administration. This paper is about a regulation concerning the implementation of exploration and exploitation of natural gas which has the effect to both parties that involved in the process of the utilization of natural gas in several other businesses upstream. Firstly, the problem needs to review is, how is the authority of Minister of Energy and Mineral Resources in terms of re-allocation gas based on sovereignty country as stated in the Article 33 paragraph (3) of The 1945 Constitution of the Republic of Indonesia? Secondly, how the regulations of natural gas reallocation in Indonesia associated with the legal certainty?
The authors are affiliated to the Administrative Law Departement, Faculty of Law, Universitas Padjadjaran, Bandung, Indonesia.