Pertamina to issue US$100 million bond

State oil and gas firm Pertamina said Tuesday it would issue bonds of US$100 million through its unit PT Pertamina Tongkang in six months shortly after Pertamina formally becomes a limited liability company.

?In six months, when Pertamina has become a limited liability company, it will issue bonds. The bonds will be very important and meaningful for Pertamina,? the company?s finance director Ainun Naim told a parliamentary hearing.

Ainun said that proceeds from the bonds would be used to finance Pertamina?s domestic projects.

He said issuing bonds was financially more effective for Pertamina than borrowing from overseas because foreign loans were highly priced.

Earlier, Pertamina president director Baihaki Hakim said that it planned to sell some of its units through initial public offerings as well as issue bonds to finance some projects.

Baihaki said that Pertamina needed $4-5 billion over the next five years to develop oil and gas projects.

Pertamina Tongkang is a ship chartering company and provides related services.

Pertamina will formally become a limited liability company on April 1, 2003. (godang)