PLN turns to oil supply

PLN turns to oil supply

LONDON (Reuters): Indonesian state power utility PT Perusahaan Listrik Negara (PLN) wants to buy more oil products for power generation and cut gas purchases made in hard currency, an energy official said yesterday.

Increased purchases would help to shore up Indonesia's sagging oil products demand which has been depressed by the country's economic crisis and would help conserve PLN's foreign exchange holdings, Purnomo Yusigiantoro, adviser to Indonesia's Energy Minister Kuntoro Mangkusubroto, said.

PLN, which has a monopoly of power disribution in Indonesia and has earnings in rupiah, pays for gas in dollars and for fuel oil in rupiah.

"So for PLN, it's easier to switch the fuel from gas to oil. And in most of their gas power plants they have dual (capacity for either gas or oil generation)."