Pertamina expects lower net profit this year
Pertamina expects lower net profit this year
The Jakarta Post, Jakarta
State oil and gas company PT Pertamina said on Wednesday net
profit this year was expected to decline to Rp 4.5 trillion
(US532.54 million) from Rp 5.4 trillion last year.
Company president Ariffi Nawawi said that the lower profit was
mainly linked to a loss in fees obtained from managing government
oil and gas production-sharing contracts.
The company lost this mandate in August last year following
the introduction of legislation that liberalized the country's
oil and gas sector and put an end to Pertamina's decades-long
monopoly.
BP Migas, the regulator of the oil and gas sector, now
controls the mandate.
Arifi did not give a projection for next year.
However, company deputy finance director Andre Hidayat said
that net profit next year was projected to increase to Rp 7.6
trillion due to lower income tax and revenue-sharing with the
government, following the change in its status into a limited
liability company in September.
He added that the company would restructure some of its
subsidiaries, in which loss-making units would either be sold,
merged or liquidated.
Elsewhere, Ariffi said that Pertamina planned to develop a
number of "strategic projects" in 2004.
"The year 2004 will be Pertamina's initial period as a limited
liability company, so we'll develop a number of projects, but the
results of these will only be visible in three to four years," he
said.
He added that Pertamina would seek strategic partners to
develop the projects. He did not elaborate.
Meanwhile, Ariffi said that PT Tuban Petrochemical Industries
would soon receive badly-needed financing from Japanese investors
to resume development of the stalled petrochemical project in
Tuban, East Java.
Pertamina has a 15 percent stake in the project.
Ariffi said that Japan's Sumitomo Mitsui Banking Corp. and
Mitsui & Co. would provide some $400 million in loan.
Ariffi said that he would sign the loan agreement in Tokyo on
Thursday.
The petrochemical project was halted in 1998 following the
regional economic crisis.
The plant has an installed production capacity of 500,000 tons
of paraxylene per year, plus 100,000 tons of orthoxylene and
toluene per year.