'Pertamina must control oil market'

JAKARTA (JP): The House of Representatives wants the state- owned oil company Pertamina to maintain its monopoly of the domestic oil fuel market, Iskandar Mandji of the ruling Golkar faction said yesterday.

Mandji of the House's Commission for Mines, Industry and Trade made the remark in a hearing with Pertamina yesterday in reaction to the government's plan to liberalize the domestic oil market for private refiners.

"If private refiners are allowed to sell their products, they will also ask for authority to determine the prices and that is very dangerous because oil fuel is the most strategic commodity that may influence other sectors," he said.

Secretary-General of the Ministry of Mines and Energy Umar Said told a press conference last week that the government would submit a bill to the House later this year which would allow private refiners to sell their products domestically, provided that the crude is imported.

The Indonesian Petroleum Association (IPA) welcomed the government's plan, saying that the plan would attract its members to invest in oil refinery.

Baihaqi H. Hakim, an IPA director, told a press conference last week that the liberalization of the domestic oil fuel market would be an incentive that would attract more foreign investment to the oil industry.

Mandji said yesterday that the government should instead improve the incentives for investments in oil explorations and development and refining.

Pertamina's president Faisal Abda'oe refused to comment on the government's plan to allow private refiners to sell their products on the domestic market.

"We'd better wait for the government's explanation," he said at yesterday's hearing. (04)