Pertamina reviewing LPG operation
Thursday, November 2 2000 - 07:00 AM WIB
State oil and gas company Pertamina said it was reviewing its liquefied petroleum gas (LPG) operation following the operation's continued losses.
Pertamina's spokesman Ridwan Nyak Baik said in a statement that Pertamina's LGP operation booked Rp 494 billion (US$1=Rp 9,165) in losses in the six month period from April to September this year or Rp 82.3 billion per month.
"The amount of losses is projected to increase in line with the rise in market demand," he said, adding domestic demand for LNG was growing by 12 percent annually.
He further said Pertamina booked Rp 557 billion in the fiscal year of 1999/2000 or Rp 46.4 billion per month with total consumption reaching 906.377 tons.
In the six-month period of April-September 2000, total consumption reached 490.781 tons, he said.
He said the continued losses were caused by the fact Pertamina sold LPG on the local market very cheaply compared to the international price.
Pertamina sells LPG at the price of 1,500 per kilogram (kg) since May 1998, as against the international price of between Rp 2,655 and Rp 3,219 per kg.
It is not clear if Pertamina wants to reduce its LPG operation or raise LPG price.
LPG is a mixture of propane (30 percent) and butane (70 percent). (Godang)