Pertamina Officially Terminates Petral`s Operations

Jakarta (Antara Bali) - State-owned oil and gas firm PT Pertamina has officially terminated operations of its subsidiary PT Pertamina Energy Trading Limited (Petral) and will liquidate it later, President Director of Pertamina Dwi Sutjipto said.

"We saw that the role of Petral in Pertaminas business activities was no longer significant. So we decided to stop its operations from today," Sutjipto stated here on Wednesday.

The termination of Petrals operations was agreed upon by Pertaminas commissioners, he noted.

Sutjipto added that the liquidation will be preceded by financial and legal due diligence processes and auditing to be carried out by an independent auditor.

"To make the process transparent, we will involve an independent auditor with good qualifications," the president director remarked.

He gave his assurance that his side will also involve related government agencies such as the State Audit Board (BPK).

Moreover, Pertaminas integrated supply chain will take over the activities of Petral such as crude exports and imports and refinery production.

At the same time, Pertamina will also improve its governance.

With this decision, all rights and responsibilities of Petral will be taken over by Pertamina.

State-Owned Enterprises Minister Rini Soemarno had implied last month that the government would soon liquidate PT Petral, a unit of state-owned Pertamina working in oil exports and imports.

"Insya Allah [God willing], this year [a decision will be made]. I have already received a report from Pertamina, and I will take it to the president to decide," she was quoted by the Jakarta Post as saying in a hearing with Commission VI of the House of Representatives on state enterprises in Jakarta on Friday (April 24).

Soemarno added that Pertaminas report covered Petrals operations.

"I asked for a detailed report on Petral, including its legal status and employees," she said, adding that a big part of Petrals operations had been moved to Jakarta from Singapore.

"Since January 2015, they [Pertamina] began direct purchases from Jakarta and not through Singapore," she revealed.

With these direct purchases by Pertamina, Petral will no longer be needed.

There have long been calls for Petral, which was established in 1976 with Pertamina as a majority shareholder, to be liquidated as it has been suspected to be a haven for corrupters from the state-owned oil company.(WDY)