Pertamina to import more fuel to up reserves
Pertamina to import more fuel to up reserves
Fitri Wulandari and Tony Hotland, Jakarta
State oil and gas firm PT Pertamina will import more gasoline
and diesel fuel to gradually boost its fuel reserves to a safe
level of 24-days supply to avoid shortages during the current
election period.
Pertamina fuel division head Mukti Wibowo said national fuel
supplies currently stood at 20.4 days.
"We will import an additional 10,000 kiloliters (KL) to 20,000
KL (per day) for gasoline and diesel fuel," Mukti told reporters
on Monday.
Other types of fuel were in sufficient supply, Mukti said.
Gasoline reserves stand at 14 days of demand with daily
consumption of 40,000 KL a day. There are 18.2 days of diesel
fuel reserves with a daily consumption of 72,000 KL a day.
The company made the comments following reports of fuel
shortages affecting several parts of the country.
Pertamina spokesman Hanung Budya Yukyanta said shortages in
the regions were mainly due to technical problems such as
transportation.
Hanung said with fuel reserves at around 20 days, shortages
were likely when there were distribution problems such as bad
weather or technical problems with the tankers.
"Reserves of 24 days will allow us to have more supplies when
there are disruptions in fuel distribution," Hanung said, adding
that it would take more than two months to increase the reserves
to 24 days.
He added the company may buy the fuel from outside its
traditional suppliers such as Singapore and the Middle East due
to increasing demand in summer in the U.S. and Europe.
Fuel may be Imported from China, India and Africa, the company
said.
Total consumption of oil-based fuel products is 170,000 KL a
day of which between 130,000 to 140,000 KL is supplied by
domestic refineries. Between 30,000 to 40,000 KL a day is
imported.
Despite being the largest oil producer in Southeast Asia, the
country's domestic refineries are only capable of supplying 80
percent of domestic consumption. There are nine refineries with a
combined installed capacity of 1 million barrels a day.
Hanung also dismissed suspicion that the low reserves were
caused by rampant fuel smuggling out of the country.
The low inventories exist because the company still faces
cash-flow problems partly due to the government's failure to
reimburse monthly fuel spending undertaken by the company, he
explained.
The cash shortage affects the company's ability to import fuel
products.
But the Ministry of Finance has recently agreed to reimburse
between 90 percent and 95 percent of the fuel subsidy to
Pertamina each month.
The delay in the reimbursement of the subsidy had been
aggravated by the soaring international oil price.
"The plan to import additional fuel will depend on the
availability of financing," Hanung said.
He said the government had promised to pay Rp 12 trillion and
Rp 14 trillion for June and July fuel spending respectively.
Meanwhile, director general of financial institutions at the
Ministry of Finance Darmin Nasution said that Pertamina should
not put the blame on the government for its financial woes.
"Even if the government manages to pay according to the new
mechanism (monthly disbursement), no one can guarantee that
Pertamina's cash problem will be resolved because its debt to the
government is bigger than the monthly oil subsidy," he said.