Pertamina set to lower CNG price
Tuesday, July 18 2006 - 12:50 AM WIB
Pertamina marketing deputy director Hanung Budya told reporters after a British Petroleum seminar on a statistical review of world energy Monday that the price cut would be introduced so as to support the government?s campaign to promote the use of more environmentally friendly fuels.
Hanung said that the price reduction would not significantly affect the company?s bottom line as the number of CNG users was still very small.
?However, in order to maintain investor interest in the CNG business, we will maintain the profit margin for each liter equivalent of CNG that is sold,? added Hanung.
He said that as part of the efforts to support the promotion of environmentally friendly fuels, beginning August, Pertamina would only sell biodiesel in Jakarta.
He explained that 16 gas stations already sold biodiesel, and 11 others would complete the upgrading of their equipment for biodiesel sales this week.
He gave assurances that the price of biodiesel would be the same as that of ordinary diesel - currently Hp 4,300 per liter.
Due to logistical problems, only gas stations in large cities would be required to comply with the Pertamina biodiesel policy, Hanung said, adding that Surabaya would, for example, implement the policy in October.
He said that in another effort to promote the use of cleaner fuels and, reduce dependence on oil-based fuel, the government would provide a subsidy for liquefied petroleum gas (LPG).
Under a pilot project set for August, 500 families in a selected sub district would be sold LPG at Hp 4,250 per kilogram, lower than, the average price of Rp 7,000 per kilogram, he said.
He said that stoves and three-kilogram gas canisters would be distributed free to the families by the government through the State Ministry for Cooperatives and Small and Medium Enterprises.
?With this program, we hope that the use of the highly subsidized kerosene can be reduced,? he added. (*)