Foreign banks cautious in providing L/C to Petral

Foreign banks are beginning to be careful in providing letter of credit (L/C) facility to Pertamina Energy Trading Limited (Petral) -- a subsidiary of state-owned oil and gas PT Pertamina -- following the seizure of Petral Hong Kong’s assets by the curator of Karaha Bodas Company (KBC), the Bisnis Indonesia newspaper reported in its Friday edition.

“Banks are just more careful because of recent news regarding Petral Hong Kong,” Petral’s Vice President (Finance) Budhi Himawan was quoted as saying by Bisnis.

But Budhi dismissed news reports that banks have been completely unwilling to provide L/C facilities to Petral, adding that so far Petral is functioning normal.

But a government source revealed to the Bisnis that the foreign banks like Standard Chartered and BNP Paribas have asked for details about Petral in connection with the settlement legal dispute with KBC.

Meanwhile, Pertamina’s spokesperson Hanung Budya admitted that several banks in Singapore have contacted Pertamina to know more about the Pertal case.

But he said he didn’t remember the names of those banks.

Petral is a subsidiary of state oil and gas firm Pertamina.(*)