Govt changes ICP formula

The government has changed Indonesia Crude Price (ICP) formula and it will no longer use the Asean Petroleum Price Index (APPI) as one of components in determining the price of the country's crude oil price because the index no longer reflects up-to-date market prices.

 

Director General of Oil and Gas at the Ministry of Energy and Mineral Resources Luluk Sumiarso said Wednesday that beginning July shipment, the government had been using price references provided by Singapore's Platts and Japan's RIM Intelligence Co..

 

The new ICP formula is 50 percent based on Platts and 50 percent based on RIM. Previously, the formula was 5 percent based on APPI, 47.5 percent on Platts and 47.5 percent by RIM.

 

He, however, said that the government would continue to use the existing formula in determining the country's LNG price reference (LPR) because this formula had given more advantages to the country's LNG exports.

 

The current LPR formula LPR is 20 percent based on APPI, 40 percent on Platts and 40 percent on RIM. (godang)