Pertamina suffers big losses from LPG

JAKARTA. PT Pertamina suffered substantial losses throughout 2012 from its downstream business, especially in the distribution of liquefied petroleum gas (LPG), while subsidized fuels also seriously affected the oil and gas firm’s profitability last year.

Pertamina president director Karen Agustiawan told reporters on Wednesday that the firm would have reaped net profits above the Rp 25.89 trillion (US$2.76 billion) it booked last year if it had not been for the LPG and subsidized fuel losses.

“Without the losses from our LPG business and subsidized fuel sales, Pertamina would have booked $3.23 billion [Rp 31.54 trillion] in net profits,” Karen said in Jakarta following the firm’s annual shareholders meeting.

The Jakarta-based firm’s audited financial report for 2012 revealed the firm booked Rp 25.89 trillion in net profits last year, an increase of 26.4 percent compared to the Rp 20.47 trillion it reaped in 2011.

Pertamina, however, suffered Rp 84.4 billion in losses from sales of subsidized fuels and Rp 5.1 trillion in losses from the sales of LPG. As a consequence, Karen said, the company would be increasing the price of its 12-kilogram LPG canisters in March this year.

Having been selling LPG below market prices, Pertamina had planned to increase the price of LPG canisters several times but the plan was rejected by both the government and the House of Representatives.

Currently, Pertamina’s 12-kilogram LPG canisters sell for Rp 70,200 per cylinder, around half the real price of Rp 120,768 per cylinder. The firm plans to increase the price of the canisters by Rp 2,166 per kilogram or Rp 25,400 per canister.

On that basis, each 12-kilogram LPG canister would sell for Rp 95,600 per canister, albeit still below the real price.

In 2012, Pertamina sold 5.07 million tons of LPG — both subsidized and non-subsidized — up from the 4.4 million tons the firm traded a year earlier.

Pertamina is also obliged to distribute subsidized gasoline for transportation, such as Premium, which sells for Rp 4,500 per liter, the cheapest price in Southeast Asia.

In addition, Pertamina revealed on Wednesday that the firm would contribute Rp 7.74 trillion in dividends to the state revenue in 2013, or 30 percent from the corporation’s 2012 net profits. This figure is 7.5 percent higher than the Rp 7.2 trillion Pertamina contributed to the state revenue in 2012.

Overall, the firm contributed Rp 66.11 trillion to state revenues this year both from taxes and dividends, up 5 percent from a year earlier, when Pertamina contributed Rp 63.03 trillion.

Pertamina also reported that throughout 2012, the firm’s oil and gas output reached 461.64 thousand barrels of oil equivalent per day (boepd), a slight increase from the 457.64 thousand boepd in 2011.

Karen’s tenure as Pertamina’s CEO is due to end on March 5 this year. On Wednesday Pertamina’s head of the board of commissioners, Sugiharto, said shareholders had yet to discuss Karen’s replacement.

He added, however, that the commissioners hoped Pertamina’s success and achievements would continue “if her [Karen’s] tenure is extended”. (Amahl S. Azwar)