Pertamina's monopoly over gasoline ends

JAKARTA (JP): The government's decision to let private companies import raw materials for unleaded gasoline production poses no problem to state oil firm Pertamina, the company's president said yesterday.

Pertamina's president, Faisal Abda'oe, said the decision would not hurt Pertamina's business.

"It is the government decision. We support it," Faisal told newsmen after receiving an ISO 9002 certification award for Pertamina's lube oil blending plant in Cilacap, Central Java.

The minister of mines and energy, I.B. Sudjana, issued a decree on March 24 allowing private companies to import raw materials for four types of unleaded gasoline instead of buying it from Pertamina.

The four types of unleaded gasoline are Premix, Super TT, Prima TT and Petro 2T.

Premix, Super TT and Prima TT are for four-wheeled cars, while Petro 2T is for motorcycles and boats.

Before the decree Pertamina was the only company allowed to sell the raw materials for unleaded gasoline production, including premix.

Premix makers bought the raw materials from Pertamina and blended it with additives to make Premix.

The decree also allows private gasoline makers to market their products themselves and set their own prices.

Sudjana said the decision was made to support the government's Blue-Sky campaign to phase out leaded gasoline by 1999.

Faisal said the decree encouraged private companies to be involved in gasoline production and Pertamina was ready to compete with them.

"We have been in this business a long time," Faisal said about the prospect of competition.

The Kontan tabloid reported that Premix gasoline makers would import high octane motogas components (HOMC) instead of buying them from Pertamina.

HOMC costs Rp 400 (16 US cent) in Singapore compared to Pertamina's Rp 700.

There are five Premix makers in Indonesia. They are PT Humpuss Trading, Pertamina's subsidiary PT Elnusa, PT Giga Antrax, PT Sinar Pedoman Abadi and PT Panutan Selaras.

The head of Pertamina's logistic division, Mahdi Hasmi, said the five firms make about 500,000 kiloliters of Premix a year, with annual growth about 10 percent.

Elnusa and Panutan are the biggest makers, making 40 percent and 25 percent of supply respectively.

Pertamina plans to make Premix at its oil refinery in Balongan, West Java.

According to Kontan, Pertamina wanted the private Premix makers to act as its distributors rather than as direct competition.

Faisal said Pertamina would go ahead with is production plans in case the private Premix makers rejected Pertamina's offer. (jsk)