Pertamina Resupplies PLN with Subsidized Diesel

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  • TEMPO.CO, Jakarta - The feud between two energy state-owned companies PT Pertamina and PT PLN ended yesterday. Coordinating Minister for the Economy Chairul Tanjung said Pertamina has agreed to redistribute subsidized diesel fuel—known as Solar—to PLN since yesterday.

    PLN also agreed to the price changes Pertamina requested, which is 109.5 percent of the Mean of Platts Singapore (MOPS) price. The price is valid for the shipping period of July to December 2014.

    The feud began when Pertamina asked for a 112-117 percent MOPS price formula for the supplies in 2013 until 2015. However, PLN only agreed to 105 percent of MOPS, using electricity subsidy computation as reasons.

    The price disagreement caused Pertamina to reduce its Solar diesel supply to PLN's power plants in Sumatra and Bali by 50 percent since August 1, 2014. A supply cut was also conducted on August 4, 2014 to PLN's power plants in Samarinda, Pontianak, and Bangka-Belitung.

    Pertamina even went as far as threatening PLN to completely cut off its Solar supply by August 10 if no price agreement if reached. Pertamina said it needs a more economical price to compensate for the losses they suffered, which amounted to US$45 million in the first semester of this year.

    Pertamina spokesman Ali Mundakir said the two SOEs have agreed on a new price and as well as PLN's debt payment.

    With the new price deal, Pertamina's diesel fuel supply for PLN's power plants will be back to normal. "Everything is normal starting from today," he said.