BP Indonesia plans to enter fuel retail market

BP Indonesia which operates a number of oil and gas concessions in Indonesia has expressed a strong interest to enter the country?s fuel retail market but the company says that it should wait for the clarification of the foreign companies? involvement before starting the business, Kompas reported on Monday.

BP Indonesia?s Vice President for Government and Public Relations Satya W Yudha said in Jakarta last week that the liberalization of the Indonesian oil downstream activities including the fuel retail market as stated in the new oil and gas law would certainly offer new business opportunities for foreign companies.

He, however, said that foreign companies such as BP Indonesia could not immediately take the business opportunity because the existing law had not yet clearly regulate the foreign participation in the fuel retail market.

"Investors are mostly still waiting for a new regulation before entering the retail market," he said.

The government?s policy to impose a price ceiling in the sales of fuel also still hampers foreign players from entering the retail market. It will be difficult for a foreign company to enter the retail market if the government still continues to provide a subsidy, he added. (*)