Vice minister lauds Pertagas-PGN merger plan
Monday, November 25 2013 - 11:24 AM WIB
Vice Minister of Energy and Mineral Resources Susilo Siswoutomo lauded on Monday the plan to merge state owned gas disrtributor PT Perusahaan Gas Negara (PGN) and Pertagas, a subsidiary of state owned oil and gas firm PT Pertamina (Persero), saying the merger, if realized, will boost gas infrastructure development in the country.
?The merger plan is good because it will provide certainties for gas pipeline development. Besides, the costs and risks (of gas pipeline development) can be minimized,? Susilo said on Monday.
He said the ministry and upstream authority SKK Migas, downstream authority BPH Migas, Pertagas and PGN is drafting a road map of gas supply and demand for Indonesia until 2030 in order to identify the priority areas for the development of new gas pipelines and for the implementation of open access pipelines.
The planned merger has sparked controversies since Pertamina has proposed the new entity resulting from the merger to become its subsidiary. Experts say PGN is much healthier and stronger than Pertamina in terms of financial condition. Furthermore, PGN, listed on the Indonesian Stock Exchange, is considered by many people as one of few companies in Indonesia which has successfully carried out good corporate governance practice. They thus consider the government should leave PGN as it is now or let PGN acquire Pertagas.
Editing by Johannes Simbolon