RI opens fuel retail market

RI opens fuel retail market

Indonesia opened up its fuel retailing industry by allowing international companies including Malaysia's Petroliam Nasional Bhd. to import and sell oil products, the Energy and Mineral Resources Ministry said.

The regulation was signed by President Megawati Soekarnoputri on Oct. 14 and effective immediately, the ministry said in a statement.

The ministry has the authority to decide the "type, the standard and the quality of the fuel" sold, it says.

Indonesia ended state-owned PT Pertamina's monopoly on fuel sales last year. The Energy Ministry then issued licenses to non- state companies to sell fuel in the country, with the licenses effective once the regulation was put in place on Oct. 14.

A unit of Petroliam Nasional, or Petronas as Malaysia's state- owned oil and gas company is known, was among the companies that won a license to import and sell fuel in Indonesia, Bisnis Indonesia reported on Aug. 9, citing Faris Mustafa, a Petronas senior official.

PetroChina Co., Total SA, and BP Plc were among the companies seeking licenses to sell fuel in Indonesia, BPHilir Migas, an Indonesian oil and gas regulator, said last year.

Oil and gas companies operating in Indonesia are also allowed to extend local production contracts 10 years before expiry, the ministry said today.

The regulations will make it easier for companies including France's Total to plan their investments in the country, Director General of Oil and Gas Iin Arifin Takhyan said on Aug. 22. -- Bloomberg