Pertamina to buy crude oil from local oil producers

State owned oil and gas company Pertamina will buy crude oil from local oil companies to meet crude oil needs of its refinery plants beginning next month.

"We have talked with production sharing contractors, and hopefully next month we can begin the crude oil purchase from them," Pertamina's Vice President Mustika Saleh said in Jakarta on Friday.

Mustika said that the purchase of crude oil from local oil producers would reduce transportation cost. Although the types of local crude oil are different from those of imports, all the country's refinery plants, except the Cilacap refinery plant, could use them, he said.

Pertamina needs at least US$1.1 billion a month to finance crude oil imports. The purchase of the American currency to import the crude oil has often jeopardized the foreign exchange trading in the country. Last month, the rupiah dropped to nearly Rp 10,000 against the U.S. dollar from about Rp 9,500 due to a massive purchase of the dollar by Pertamina. (dino)