The fate of PT PIM will be decided next week: Vice President

Vice President Jusuf Kalla said on Friday tat the government will decide on the fate of Aceh-based fertilizer producer PT Pupuk Iskandar Muda (PIM) next week,Bisnis Indonesia reported on Saturday.

Speaking to reporters at his office, the Vice President said that the government was considering of making imports to ensure the gas needs of the fertilizer plant.

"However, the gas price in the international market is very high. The government will have to provide a subsidy of at least Rp 500 billion to meet the company's gas needs of about 10 cargo," he was quoted as saying. "We are still assessing if there is a budget for such subsidy, and also to study the possibility of exporting PIM's fertilizer," he said.

The government has asked gas producer ExxonMobil Indonesia to resume gas supply to the fertilizer plant which has been temporarily idle due to the lack of gas supply. As the current gas production of ExxonMobil is only enough to meet the export commitment of Arun LNG plant, Pertamina has promised to import LNG to help the LNG producer meet its export contracts.

Meanwhile PIM's president Hidayat Nyakman said that the company' gas stocks of about three cargoes would deplete in June. "We therefore hope the government will soon provide new gas supply to prevent the company from halting its activities," he said, adding that the company would need at least 12 more cargoes of gas to be able to continue its activities.

"If the plant stops operation for about three months, the government will suffer a loss of more than US$267 million, much higher than if it imports the gas," he said. (*)