Pertamina, TPPI win PLN?s diesel oil tender

State owned oil and gas company Pertamina and PT Trans Pacific Petrochemical Indotama (TPPI) have won a tender launched recently by state electricity company PLN to provide about 1.25 million kiloliters of diesel oil for four years to the company?s several power plants, Kontan business daily reported on Wednesday.

PLN?s president director Dahlan Iskan confirmed on Tuesday that the two companies had won the tender, saying that TPPI had been named to provide diesel oil for PLN?s two combined-cycles power plants PLTGU Tambak Lorok in Semarang and PLTGU Belawan in Medan.

Meanwhile, Pertamina had won tender to provide diesel oil for PLN?s three combined-cycles power plants PLTGU Muara Tawar in Bekasi, PLTGU Grati in Gresik and PLTU Muara Karang in North Jakarta.

Dahlan, however, did not specify the volume of diesel oil to be supplied the two companies. ?The volume of the diesel oil to be supplied by Pertamina will be much bigger than those by TPPI,? he said.

However, the appointment of TPPI drew protests from Pertamina, which claimed the former has breached "business ethics" by supplying diesel oil to PLN.

Pertamina?s spokesman Mochamad Harun said that TPPI had agreed to provide middle distillate oil worth US$50 million to Pertamina every six months as part of a product swap deal to repay its US$600 million debts (including interest) to the state oil and company.

?TPPI had breached the swap deal for almost 1.5 years, but it instead joined PLN?s tender,? Harun said.

Dahlan said that TPPI had been named as one of the diesel oil providers because it offered diesel oil for just 3 percent above Mean Oil Platt?s of Singapore?s price standard.

Aside from the attractive bidding price, TPPI has a large production capacity of 2 million kiloliters a year. With the supply from TPPI, PLN could save up to Rp 450 billion, Dahlan said. (*)