Govt plans to cut gas prices for fertilizer producers
Saturday, July 22 2000 - 04:00 AM WIB
The government will reduce the price of natural gas for fertilizer plants in the country to US$ 1,3 - US$ 1,5 per million milliom British thermal unit (mm btu), a senior governmental officer said.
"The president has agreed to lower the natural gas price for fertilizer producers," Mines and Energy Minister Susilo Bambang Yudhoyono was quoted as saying by Antara news agency on Saturday.
Before this, fertilizer plants purchased their natural gas from the government at US$ 1 to US$ 2 per mm btu, compared to US$ .50 to US$ 1.20 per mm btu in other countries.
Bambang however said the government is still calculating the appropriate price as the new rate could give maximum benefits not only to the fertilizer producers but to the farmers as well.
Besides the fertilizer industry, the state-owned electricity company PLN has also asked for a reduced price of natural gas, he said, adding that his office will consider the request but could not make a decision yet.
Earlier in the day, the minister after meeting with the President at Merdeka Palace had denied a report that the Malaysian oil company Petronas will invest in Indonesia.
Chief of the National Logistics Agency (Bulog) Rizal Ramil has said the Malaysian oil company will invest in Indonesia.
On the issue, Bambang, who is leaving for Kuala Lumpur, said his office and Petronas have yet to discuss the matter.
On Bambang's visit to Malaysia, he said the minister will try to buy Malaysian fuel oil as Indonesia currently faced a fuel shortage.
The fuel shortage has badly hit East Java and Bali because of damage of the Balongan oil refinery in West Java. The refinery is expected to resume normal operations on July 26.
Pertamina's Marketing Director Harry Purnomo disclosed recently that current fuel supplies are only enough for 18 days, while normally the supplies last 23 days. (*)