Purnomo uncertain about the plan to replace kerosene with LPG

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said that he felt uncertain if the plan to convert the highly-subsidized kerosene oil with liquefied petroleum gas (LPG) could be effectively implemented.

Speaking at a seminar on biofuel in Jakarta Thursday, Purnomo said that besides the lack of distribution facilities, the different market segments of the two different fuels would make it difficult to market the LPG in the rural areas.

"LPG is used by the middle class mostly in cities, while the kerosene is mostly used by financially weak group of people in villages not only for cooking but also for lighting purposes," he was quoted by Media Indonesia as saying.

The minister was commenting on the plan to promote the use of LPG in a bid to reduce the use of the highly subsidized kerosene.

The ministry's Secretary General Luluk Sumiarso said early this week that the Vice President M. Jusuf Kalla had asked the ministry to establish a special team to study the plan.

"The team will be given a week to provide the details of the planned reduction of the kerosene usage," he said.

The government removed the subsidy of kerosene to industrial buyers in October last year but maintained the subsidy for the sales of kerosene to households.

The high subsidy has, however, caused a serious problem to the state budget which has been under pressure due to the persistent increase in the crude oil prices in the international market. (*)