Free gas stoves, cylinders to go out to kerosene-guzzling areas

The Jakarta Post , Jakarta | Sat, 11/25/2006 12:33 PM | Jakarta

Adianto P. Simamora, The Jakarta Post, Jakarta

State oil and gas company Pertamina will start distributing cylinders of liquefied petroleum gas (LPG) to households and food vendors in the city whose primary cooking fuel is kerosene, an official says.

The program is part of the government's efforts to reduce kerosene consumption and cut fuel subsidies.

""We will supply 25,000 three-and-a-half-kilogram LPG cylinders to low-income households in and around Kemayoran, Central Jakarta, by mid-December,"" Pertamina spokesman Toharso told The Jakarta Post on Friday.

Pertamina has so far distributed 500 LPG cylinders in Kemayoran as part of a three-month trial that started in August.

""However, we are still waiting for the government to decide whether the cylinders will be free. It is a government program,"" Toharso said.

He said Pertamina was in the process of identifying other areas of Jakarta and Tangerang where there is a high rate of kerosene consumption.

Pertamina currently supplies about 3,100 liters of kerosene every day in Jakarta.

More than 10 million kiloliters of kerosene enters the domestic market every year, half of which is used for cooking.

The government has allocated Rp 40 trillion to subsidize kerosene for household purposes.

Pertamina is the only distributor of LPG in the country. The company gets 800,000 tons of the fuel per year from its refineries and another 300,000 tons from several oil companies operating in Indonesia.

The plan to substitute kerosene with LPG in households is supported by the State Ministry for Cooperatives and Small and Medium Enterprises, which will supply households with gas stoves.

The ministry estimates that one kg of LPG is more or less equal in energy content to three liters of kerosene.

Pertamina currently sells LPG at Rp 4,250 per liter, while heavily subsidized kerosene costs Rp 2,000 per liter. Industrial buyers pay Rp 6,000 per liter of kerosene.

The price gap is often blamed for the frequent kerosene shortages in the city.

The ministry is set to raise kerosene prices after residents have received their gas stoves.

State Minister for Cooperatives and Small and Medium Enterprises Suryadharma Ali said the ministry would give out 800,000 gas stoves within two years, allocating Rp 58.6 billion for the production of 400,000 stoves this year.

Pertamina earlier said it would supply 12 millions LPG cylinders in 2007.

Toharso, however, warned the project would not go ahead if the state ministry did not supply enough gas stoves.

""The distribution of gas stoves and cylinders must be carried out simultaneously in order to reduce costs,"" he said.

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