Pertamina's gross profit drops to Rp1.8t

Pertamina's gross profit drops to Rp1.8t

JAKARTA (JP): State oil and gas company Pertamina booked a
gross profit of Rp 1.79 trillion (US$238 million) from its wholly
owned oil and gas fields and joint ventures for the fiscal year
of 1997/1998, a 42 percent decrease from Rp 3.09 trillion in the
previous fiscal year.

"The figures have been audited by the State Financial
Comptroller Agency (BPKP) which gave Pertamina an unreserved
thumbs-up for its 1997/1998 financial report," Pertamina's
outgoing president Soegianto said on Thursday on the sidelines of
the ceremony to celebrate the company's 41st anniversary.

Pertamina's public relation office said in a statement on
Thursday that Pertamina booked a gross profit of Rp 1.67 trillion
from its wholly-owned oil and gas fields in 1997/1998 fiscal year
ended in March.

Soegianto ascribed the sharply decreasing profit to the sharp
depreciation of the rupiah against the dollar since the middle of
last year.

In its auditing report, BPKP said that Pertamina's corporate
performance remained very healthy despite the drop in the gross
profit.

Pertamina has successively received unreserved backing from
BPKP over the past 10 years, the statement said.

However, Pertamina's statement did not reveal Pertamina's net
profit for 1997/1998.

Pertamina booked a net profit of Rp 1.4 trillion in 1996/1997,
after meeting its financial obligations amounting to Rp 1.63
trillion to the government.

Soegianto refused to reveal the amount of the company's
financial obligations to the government for the fiscal year of
1997/1998, but he said the government had agreed to pay its
financial obligations in installments over the next two years to
help Pertamina cope with the monetary crisis.

"We hope to book a gross profit of between Rp 2 trillion and
Rp 3 trillion in the current fiscal year," Soegianto said.

Subsidy

Soegianto also noted that Pertamina would no longer subsidize
the sale of natural gas to the country's fertilizer producers
following the government's recent decision to lift the subsidy on
the fertilizer sold to farmers.

Currently, Pertamina sells natural gas -- the raw material for
the making of fertilizer -- to the country's fertilizer producers
at between $1.82 and $2 per million British Thermal Unit (MMBTU),
while other companies, including state electricity company PLN,
buy the gas for up to $3 per MMBTU.

"We want to sell natural gas to fertilizer companies at a
price based on the cost of development," Soegianto said.

Soegianto, who will be replaced by Martiono Hadianto, director
general of customs and excise at the Ministry of Finance on
Monday, also said in his speech that Pertamina had started
developing two oil finds in Sopa and Tepus, South Sumatra, which
are believed to contain relatively big reserves.

"The two oil discoveries are expected to increase Pertamina's
oil and gas production from its wholly-owned fields," Soegianto
said.

Soegianto also said the restructuring programs at the company
exploration and production directorate had succeeded in lowering
the company's costs of oil and gas production.

Company cost of oil production currently stood at between $5
and $7 per barrel, Soegianto said, but did not reveal the cost of
gas production.

In the refinery sector, Soegianto said, Pertamina had
completed the debottlenecking project at its Cilacap refinery
this year to increase its lube base oil production capacity by 70
percent and its asphalt production capacity by 40 percent.

Pertamina had also successfully launched an environmentally-
friendly gasoline for two-cycle machines, called BB2L gasoline,
this year, Soegianto said.

This year Pertamina has also received the ISO 9002
certificates for its aviation gasoline depots at the Ngurah Rai
airport in Bali and the Soekarno Hatta airport in Jakarta, and
the lube plant in Cilacap, Central Java and the liquefied
petroleum gas (LPG) container manufacturing plant in Plumpang,
Jakarta. (jsk)