Pertamina plans to buy existing LPG depots

State owned oil and gas company Pertamina will buy up to 51 percent of the ownership of existing Liquefied Petroleum Gas (LPG) depots to anticipate the opening of the country's fuel retail market to foreign companies, Bisnis Indonesia daily reported on Thursday.

Iqbal Hasan, general manager of Pertamina's LPG and Special Products said in Jakarta on Wednesday that most of the owners of the existing LPG depots had agreed with Pertamina?s business partnership proposal.

Pertamina, the sole supplier of LPG in Indonesia, sells the LPG in the market through its authorized distributors. At present there is a total of 60 LPG depots in Indonesia and all are operated by private companies.

"If we build our own LPG depots it will be too expensive. Building a partnership with existing distributors will be much efficient," he said, adding that a number of foreign investors have expressed their interest to tap the country's LPG market.

According to him, the potential demand for LPG reaches about four million metric tons a year as compared to Pertamina's realized sales of about one million tons a year. (*)