PGN to remain listed firm under planned holding company

IDX-listed gas distribution firm PT PGN Tbk will remain a publicly-listed company when it would be injected into state-owned oil and gas firm PT Pertamina under the government?s planned holding company.

This was said by Deputy of the Office of the State Minister of State-Owned Enterprises, Aloysius K. Ro on Thursday. The ministry plans to set up a holding company for the energy sector, under which Pertamina will become the holding company, and PGN its subsidiary.

Aloysius explained that under the plan, the government will transfer almost all of its shares in PGN to Pertamina. ?So, what will be transferred (to Pertamina) is the shares not the assets. PGN will continue to be a publicly-listed company, not to be merged (into Pertamina),? he said.

He added that under the planned holding company, Pertamina will be in charge of the upstream business, while PGN the gas downstream side. Therefore, he said, Pertamina?s gas distribution subsidiary PT Pertamina Gas will be transferred to PGN.

He said that the holding company will among others create greater efficiency such as avoiding the development of overlapping gas pipeline projects by PGN and Pertamina Gas. This will in turn help reduce gas price in the country, where industries have long complained of the excessive price of the commodity, undermining their competitiveness. (*)