Pertamina plans to reduce workers to 18,000

State oil and gas company Pertamina planned to reduce the number of its workers to 18,000 from 26,000 at present to improve efficiency in anticipation of the free-market era, company president Baihaki Hakim said on Tuesday.

Baihaki said the company's workforce would naturally decrease by 1,000 per year thanks to retirement program but the company hoped to get rid of more workers through early retirement programs.

"Ideally, we have 18,000 workers, as against 26,000 at present.

"I shall not be in a hurry (to cut the workforce). I will prefer reducing the number of the workers through natural process, but for workers who to retire before reaching retirement age, our team is preparing an interesting (early retirement) program," Baihaki said at the palace after meeting with President Abdurrahman Wahid.

Present at the meeting with the President were Minister of Energy and Mineral Resources Purnomo Yusgiantoro and Cabinet Secretary Marsillam Simanjuntak.

Baihaki however did not reveal the timeframe for the company to complete the workforce reduction program.

He said the government was studying a proposal for the restructuring of the company's organization, which would lead to the elimination of between 30 percent and 40 percent of "structural" positions in the company, especially at the company's headquarters.

Those, who will lose structural positions and do not expect promising career after the restructuring of the company, can ask for early retirement, Baihaki said.

Baihaki said under the restructuring plan, Pertamina will have six directors, including a president director, as against seven directors at present.

Baihaki did not specify all the directorates under the new organization but he earlier said the five directorates would respectively handle upstream affairs; downstream affairs; financial affairs; human resources affairs and foreign contractors management.

Baihaki explained on Tuesday that the current directorates of general affairs, processing and domestic fuel distribution would be merged into the directorate for downstream affairs.

The shipping, port and communication directorate will be liquidated. The handling of shipping affairs to be transferred to the company's headquarters, while ports will be supervised by units and communication will be handled by information technology office.

"I hope the presidential decree (on the new organization of Pertamina) will be issued in a few days ? and I hope Pertamina will have a new organization by early January next year," Baihaki said, adding that Pertamina hoped to sell its shares to the public in three years.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro told Petromindo.Com that during the meeting the President queried about the formation of the so-called "development directorate".

"We were talking about the jobs of the development directorate, which did not only cover human resources development but also technology development," Purnomo said, but did not further specify. (Bodega/Epin)