Government supports proposal to split Pertamina?s operation
Tuesday, October 15 2002 - 03:41 AM WIB
The deputy of the state minister for state owned enterprises, Roes Aryawijaya, said in Jakarta on Monday that there was nothing wrong with the World Bank?s proposal. "Pertamina which will operate as full business entity should be ready to adopt the business pattern of international companies," he added.
"There is no pressure related to the WB?s proposal. It is normal and fair," he said when asked to comment about the proposal made by the WB?s proposal. The chief of the Indonesian office of the WB, Mark Baird, had proposed the Indonesian government to restructure Pertamina?s operation so that the company would be able to better focus on upstream activities. He also called on the need to speed up the removal of the company?s monopoly.
"Such a request is quite normal and there is something with it," said Roes, who has been tipped to replace Baihaki Hakim as the president of Pertamina. "Even without the WB?s request, the monopoly held by Pertamina will be removed in accordance with the new oil and gas law," he added.
Senior officials of Pertamina have expressed concern about the plan to split the oil and gas company?s operation, especially related to its downstream operation. If it happens, the government?s five oil refineries now being operated by Pertamina might be transferred to other company.
They accused the restructuring plan proposed by the WB as an effort to lessen Pertamina?s competitive edges so that foreign companies will face no difficulty to control the country?s oil downstream industry when it has been fully opened to private sector in the next few years. (*)