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Govt owes Pertamina $3.1b for fuel subsidy
The debt was recorded as the main source of Pertamina’s revenue from “other activities”, which stood at $3.9 billion, or a fourfold increase from 2017 when revenue reached $740 million.
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Logo of state-owned oil and gas holding company Pertamina (Courtesy of/3dwarehouse.sketchup.com)
T
he government owes state energy holding company Pertamina US$3.1 billion for selling Premium gasoline, Solar diesel fuel and kerosene below market prices, according to the latter’s 2018 financial report.
The debt was recorded as the main source of Pertamina’s revenue from “other activities”, which stood at $3.9 billion, or a fourfold increase from 2017 when revenue reached $740 million.
The report showed that the main contributor to the increase in revenue was Presidential Regulation (Perpres) No. 43/2018, which mandated a price adjustment to kerosene, solar and premium.
Under the regulation, Pertamina was required to guarantee the availability of Premium in Java, Madura and Bali, forcing the company to allocate more fuel that was sold below market prices.
Pertamina initially only allocated 7.5 million kiloliters (kl) of Premium in 2018, but in May 2018, the company had to allocate 12.5 million kl after the issuance of the policy.
Pertamina finance director Pahala N Mansury said the company had not received the compensation from the government.
“In 2018, we got [a government’s pledge for] compensation for selling fuel below market price. However, the payment is still being processed,” he said on Friday.
“We need to talk further with the government as it needs to consider its fiscal and financial conditions [before paying the debt]. But at least, the government has recognized [that it owes] Pertamina.”
His statement came after the company held its annual general shareholders' meeting on Friday morning, which revealed that Pertamina earned $2.53 billion in profit in 2018, a slight drop from the $2.54 billion in profit booked in 2017. (bbn)
