Pertamina threatens to cancel contract with PT Panutan

State oil and gas firm Pertamina is considering an option to cancel its contract with PT Panutan Selaras to build a US$85 million satellite fuel depot in Balaraja, Tangerang.

Pertamina president Baihaki Hakim said that his company was currently re-negotiating over the price of the project with Panutan as the price offered by Panutan was considered too expensive.

Baihaki said that Pertamina wanted the price of the project be revised down from Panutan's offer of US$85 million. But Panutan seemed to maintain its offer because it felt it was on a better position now.

"If until the end of this year, there is no improvement, Pertamina will take other options," he said on Friday.

According to Baihaki, other options include building more tanks in the Plumpang depot in Jakarta, or building more storage facilities in Balongan, West Java, where Pertamina's refinery plant is located.

"Therefore, Pertamina has options that will be cheaper to secure fuel supplies in Jakarta," he said. (*)