SBY says Pertamina needs restructuring

President Susilo Bambang Yudhoyono or SBY said on Thursday that state oil firm Pertamina needs restructuring and has "run slow, half-baked and ineffective".

SBY's comments came during an official visit to Myanmar and were broadcast by the private Elshinta news radio, which said the remarks were made when Yudhoyono spoke to Indonesians there.

Pertamina has been locked in a battle since last year with U.S.-based Exxon Mobil Corp. over who will operate the Cepu oilfield, Indonesia's biggest oil discovery in years, which may boost the country's declining production by some 20 percent.

Vice President Jusuf Kalla said in Jakarta on Thursday the final decision in that dispute will be Yudhoyono's.

As reported by Elshinta, the president made no direct comments on that issue, but said while Pertamina was once a model for other countries, "why now is it stuck and without progress".

"It is time for us to considerably restructure it with clear and measured stages," Yudhoyono said.

Pertamina's power over energy business in Indonesia has been gradually reduced in recent years as the country, OPEC's only Asia-Pacific member, has moved to liberalise its economy.

At various points in its history Pertamina has been hit with allegations of corruption and inefficiency.

Last year there was talk by analysts and government officials of replacing various company officers and directors, including Pertamina President Director Widya Purnama -- who has insisted that the state firm take the lead in Cepu -- but this has not yet happened.(*)