Removal of Pertamina's PSO rights delayed until next year

The removal of Pertamina's Public Service Obligation (PSO) or the right given to state owned oil and gas company to distribute subsidized fuel will be delayed until January next year because the government's financial condition has not been conducive enough to carry out the plan, Kompas reported on Monday.

Tubagus Haryono, the head of BPH Migas, the government's regulatory body for oil and gas downsteam industries, said in Jakarta last week that the removal of Pertamina's PSO rights could not be executed on November 3 as initially scheduled.

"We hope the removal of PSO can be carried out in January, next year," he said, adding that besides the government's financial problem, the delay in the PSO removal was also caused by a number of technical factors related to the distribution of the subsidized duel by private companies.

Tubagus said that the mechanism on the distribution of the subsidized fuel especially related to the appointment of private companies that will be allowed to sell the subsidized fuel was being prepared.

According to him, the government is preparing three alternatives in the appointment of companies to distribute the subsidized loans including through a direct appointment and through an auction. (*)