TEMPO.CO, Jakarta - The Integrated Supply Chain (ISC) of state oil and gas company Pertamina (Persero) saved US$208.1 million (Rp2.87 trillion) in purchases of crude and fuel oil in 2015. The ISC's is believed to have cut the procurement business chain previously run by PT Pertamina Energy Trading Ltd (Petral).
"The cost saving was obtained through ISC's five breakthrough programs called the ISC 1.0 phase," Pertamina's VP of corporate communications Wianda Pusponegoro said yesterday.
The ISC program eliminates the middleman supply chain and increases the utilization and flexibility of Pertamina's fleet. The ISC also provides fair and equal opportunities for all procurement participants.
"The breakthroughs are in the form of a transparent bid evaluation processes and cost reduction through the implementation of a telegraphic transfer payment," Wianda said.
Efficiency in procurement is also done by optimizing the use of vessels managed by Pertamina for transporting fuel oil, crude oil, and LPG imports.
The ISC opens its doors for as many as prospective partners as possible. This way, the bidders are more varied, prices are more competitive, and Pertamina's bargaining position becomes higher.
"Our bidding information is available through our website that can be accessed by all," Wianda added.
Transparency is believed to make procurement more competitive, accountable, credible, and able to eliminate potential conflicts of interest.
Wianda said that one of the successes in this new type of procurement is the renegotiation of agreement with Saudi Aramco. Aramco has an evergreen contract with Pertamina for 120,000 barrels per day (bpd). Since June 2015, Saudi Aramco no longer requires a letters of credit (L/C) from Pertamina every time they seek to import oil.
"This is the form a crude oil supplier's trust in Pertamina with regards to a guarantee of payment," said Wianda.
The ISC also works to reevaluate existing sales and purchase contracts.
LARISSA HUDA
