From Government of Indonesia

Pertamina May Get Subsidized Supply Rights

Downstream oil and gas regulator, BPH Migas may give state oil firm PT Pertamina exclusive rights to supply and distribute subsidized oil products in 2007 as private firms do not have the necessary network, its chief said Tuesday (7/11/06).

"There is no other firm so far to meet BPH MIGAS’ criteria to become a supplier and distributor of subsidized oil products, except Pertamina," Tubagus Haryono was quoted as saying by Reuters. "One of the criteria is the firm has to have a supply network in Indonesia's remote areas."

In 2004, the government opened up its domestic downstream oil business to foreign firms, including oil products retail, paving the way for them to directly import fuel and sell to local customers, after revoking Pertamina's monopoly in 2001. But BPH MIGAS evaluates the supply and distribution rights of subsidized oil products such as low-octane gasoline, kerosene and diesel every year.

The agency had given Pertamina exclusive rights to supply subsidized oil products in 2006 with estimated volumes of 37.9 million kiloliters (kl).

International firms such as Royal Dutch Shell Plc and Malaysia's Petronas have several pump stations around Jakarta to retail high-octane gasoline, and have expressed interest in participating in also supplying subsidized oil products.
Haryono said Indonesia is expected to consume 37.9 million kl (237 million barrels) of subsidized oil products in 2007, or 17 million kl of low-octane gasoline, 11 million kl of diesel oil and 9.9 million kl of kerosene. The figures are the same as 2006.
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