PGN workers union opposes holding company

The workers union of state-controlled gas distribution company PT PGN Tbk opposes the plan by the Office of the State Minister of State-Owned Enterprises to set up a holding company for state-controlled energy firms that would make PGN as subsidiary of state-owned oil and gas firm PT Pertamina as the holding company.

Chairman of the PGN workers union M. Rasyid Ridha said statement that injecting PGN into Pertamina would undermine the future expansion of PGN. He explained that PGN is a publicly-listed company, thus by putting PGN under Pertamina, a non-listed firm, it would undermine the future business expansion of PGN.

He said that if the government presses ahead with its plan to issue a government regulation on the planned holding company for state-controlled energy firms, the workers union would file a judicial review of the new regulation with the Supreme Court.

He appealed to President Joko Widodo to cancel the planned holding company for state-controlled energy firms.

The Office of the State Minister of State-Owned Enterprises plans to set up a number of holding companies including one for state-controlled energy firms, turning Pertamina into a holding company for PGN and PT Pertamina Gas. The ministry has said that the holding companies will create efficiencies and help increase capacity in raising funds to finance expansion programs.

Rasyid, however, said that PGN has never find difficulties in getting funds to finance its projects.

Editing by Reiner Simanjuntak