BPH Migas to give private firms right to sell subsidized fuel

PT Pertamina, which is Indonesia’s sole distributor of subsidized fuels, has demanded that the government uphold equality in its decision to introduce more than one subsidized fuel distributor next year. Downstream oil and gas regulator BPH Migas said it will start the selection process which will give companies the right to distribute subsidized fuel next year, opening up the possibility that foreign oil companies could end up competing with PT Pertamina in the low-octane gasoline market. Currently, only Pertamina has the right to sell low-octane, subsidized fuel, but foreign oil firms have been invited to compete for the right to distribute the fuel. BPH Migas plans to establish new distribution zones based on provinces rather than entire regions, which will increase the number of distribution zones from four to 14. Currently, Pertamina distributes four types of subsidized fuels: premium gasoline, diesel, kerosene, and the three-kilogram canister of liquefied petroleum gas (LPG). BPH Migas estimates that the volume of subsidized fuel produced in 2010 could reach 34.9 million kiloliters. (May 13/15, 2009)