AKR, Petronas may distribute more fuels
PT AKR Corporindo and PT Petronas Niaga Indonesia, two firms selected to join PT Pertamina in distributing subsidized fuels in 2010, may distribute more subsidized fuels in the following years, says the regulator.
While the tender for subsidized fuel distributors is carried out every year, both AKR and Petronas have a major chance to be selected again for 2011 and beyond, having been selected as the distributors for 2010 , giving them the edge over other rivals for the future, in term of expertise and distribution networks, said downstream oil and gas regulator BPHMigas on Monday.
"Whether they will get more subsidized fuel quotas in the following years pretty much depends on their readiness with infrastructure," BPHMigas's chairman Tubagus Haryono said in the appointment delivery ceremony in Jakarta on Monday.
During the occasion, Pertamina, AKR and Petronas were officially assigned to distribute subsidized fuels next year, which will be the first time that private companies have been involved in the subsidized fuels business, which has long been monopolized by the state oil and gas company Pertamina.
Although AKR and Petronas have been selected to assist with the distribution of subsidized fuels, which happens at national level, they can only distribute the fuels in limited volume and in limited areas under the present arrangements.
The government and the House of Representatives, through the Law on the 2010 state budget, have established that the quota for subsidized fuel distribution next year will be 36,504,779 kiloliters, which will include 21,454,104 kiloliters for Premium gasoline; 3.8 million kiloliters for kerosene; and 11,250,675 kiloliters for diesel.
Most of the quota will be distributed by PT Pertamina. AKR is only allowed to distribute 56,500 kiloliters of diesel per year in Deli Serdang, Medan, Central Lampung, South Lampung, East Lampung, North Lampung, Bandar Lampung, Banjar Masin, and Pontianak.
Petronas is only allowed to distribute 20,440 kiloliters of Premium gasoline per year in four fuel stations in Medan, North Sumatra.
Tubagus said that, besides the infrastructure, the commercial aspects would also help to determine whether the two companies would get additional quotas or not.
As for this year's assignments, both AKR and Petronas said they were ready to distribute the subsidized fuels.
"Starting from the first January 2010, we are ready to distribute the subsidized fuels. All our outlets have been audited by BPHMigas," AKR's president director Haryanto Adi Koesoemo said.
Pertamina's president director Karen Agustiawan said the presence of AKR and Petronas in the subsidized fuels distribution business would be good for Pertamina as this would make the business more competitive.
"Now we have competition in subsidized fuel distribution. I hope that Pertamina's team would do better in doing this job," she said.
Director general for oil and gas Evita H. Legowo emphasized that AKR and Petronas must give priority to buy the fuels from domestic refineries.
"We know that the outputs from domestic refineries are still small, but we want this to be used optimally. We don't want to see that AKR and Petronas import the fuels, while at the same time Pertamina wants to export the fuels from their refineries," she said.
Tubagus said all subsidized fuel distributors were required to report their sales volume on a daily basis in a bid to provide and monitor up-to-date figures on the consumption of subsidized fuels.
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