Publications

Non-Technical Risks are the most common cause of project delays and most likely to be underestimated. According to Breemer and Mckeeman (2012), NTRs can account for up to 70 -75% of cost and schedule failures. Therefore, a new shift of paradigm in the oil and gas industries have started to make efforts in managing social risk to obtain early social license to operate before the company begin its operations. One of the most frequently used tools are through its community development programs. Through interviews, observation and programs evaluation of Japanese Oil and Gas Company, INPEX Masela, this paper will discuss how the company manages one of its existing community empowerment program in facing various challenges to help obtain its social lisence and achieve its sustainability level. The result of the Government of Indonesia; decision to change the concept selection of Abadi Masela LNG project from offshore to onshore leads to difficulties in maintaining existing INPEX community empowerment program due to cost efficiency especially those that are approaching the final phase of a multi-year program which needs effort to ensure smooth transition and exit strategy. One of those programs is the Tanimbar Ikat Weaving Training. Facing these challenges, INPEX strategy approach are not only to maintain one of its existing multiyear program towards sustainability but also successfully leverage the program to an even greater level through the involvement of other parties. One of the success story is how INPEX successfully convince Indonesia's central bank (Bank of Indonesia) to conduct collaborative program to develop Tanimbar Ikat Weaving. Not only agree to collaborate, BI also contribute a significant budget to develop the program. This accomplishment made INPEX was awarded gold medal as a winner for Best Community Based CSR Program during the 2018 PR Indonesia Award.The result have found that using unique methodology and approach are found as very effective tools in obtaining social license to operate.