Perta Oil continues operations as normal
Perta Oil continues operations as normal
HONG KONG (Dow Jones): Perta Oil Marketing Ltd., an affiliate
of Indonesian state-owned oil company, Pertamina, is operating as
usual, despite government statements that Pertamina's affiliates
are under review, a source close to Perta Oil Marketing Ltd.
said.
"Business is going on as normal," he said, adding that Perta
Oil still expects to handle June oil product allocations for
state-owned oil concern Pertamina.
Perta Oil hasn't been notified officially of any plans to
cease or change its relationship with Pertamina, Asia's largest
exporter of crude oil, the source said.
Another source close to Perta Oil said, however, it wasn't
clear why Pertamina has delayed the release of June oil product
allocations, originally expected by May 20. Apart from a 3.2
million barrel low sulfur waxy residual fuel allocation issued
Wednesday, Pertamina's June allocations have been delayed by more
than one week.
The first source also described reports that Pertamina will
operate its trading directly as a "rumor that is wrongly
developed."
On Monday, the Minister of Mines and Energy Kuntoro
Mangkusubroto said Pertamina will review longstanding marketing
arrangements with two of its affiliates that have ties to family
members of former president Soeharto. The minister added that
affiliates overcharge Pertamina for their services.
The companies, Singapore-based Perta Oil Marketing and Hong
Kong-based Permindo Oil Trading Co., receive monthly allocations
of crude oil, petroleum products and liquefied petroleum gas to
buy or sell in the spot market.
Pertamina should buy back Soeharto family stakes in oil
trading affiliates instead of terminating contracts with the
affiliates, the first source said.
"If anything happens (from the review), it would only be on a
shareholder level," the source close to Perta Oil said. "The
easiest way (to resolve questions of nepotism) would be for
Pertamina to buy back shares from minority shareholders."
The source defended Perta Oil's performance as a trading
affiliate, adding that "Perta Oil is managed by Pertamina (and)
key employees are from Pertamina or Perta directly."
The Humpuss group, controlled by Soeharto's youngest son,
Hutomo "Tommy" Mandala Putra, owns 25 percent of Perta Oil. A
unit of the Nusamba group, which also has close ties to Soeharto,
holds 25 percent, with Pertamina holding the remaining share, the
source said.
PT Permindo, which is 65 percent owned by Soeharto's son
Bambang Trihatmodjo and business associates, including
Soeharto's cousin Sudwikatmono, and Nirwan Bakrie, is the other
trading affiliate whose contracts are under review by Kuntoro.
Pertamina owns 35 percent of the affiliate.
Pertamina and PT Permindo couldn't be reached for comment.