Government to open up aviation fuel market soon
Monday, March 31 2008 - 01:43 AM WIB
BPH Migas, the regulatory body for the country's oil and gas downstream industries, said that the draft regulation for the new policy had been completed and was expected be released in April 2008. Under the new regulation, private companies will be allowed to take part in the distribution and sales of jet fuel, which is more popularly called avtur.
?All parties are welcome to play in the business, either by using the existing infrastructure or building a new infrastructure,? Ibrahim Hasjim, a member of the agency's regulatory committee said on Monday.
He said that companies interested in the sales and distribution of aviation fuel needed to cooperate with state-owned oil and gas company PT Pertamina, which already has distribution facilities, and PT Angkasa Pura, the operator of the country's airports. "The cooperation should be carried out on business-to-business basis," he said.
In February 2008, Pertamina has rejected the government's plan to allow new distributors to sell avtur in the country's major airports such as Jakarta, Surabaya, Denpasar, Medan and Ujung Pandang, saying the move will be unfair for the company.
"If the market liberalization is carried out only on major airports while Pertamina is still required to sell avtur in small airports, it will be unfair," Pertamina's president director Ari Soemarno said.
Minister of Transportation Hatta Rajasa announced recently the government's plan to open the avtur market in major airports to new distributors. As part of the liberalization, the government will open a tender to appoint a consortium that will sell avtur in major airports.
He said that the opening of the avtur market in major airports would be carried out in stages, with the first one to be conducted in the newly expanded Juanda Airport in Surabaya, East Java.
Ari said that if the government went ahead with the avtur market liberalization, Pertamina would have to sell the fuel at different prices depending on the economic viability of each airport.
The avtur demand in the country reaches a total of 2.4 million kiloliters a year. About 40 percent of the total are sold through the Soekarno-Hatta airport. (*)