THE
COORDINATING MINISTRY FOR ECONOMIC AFFAIRS
Tel: (021) 351-1178
Fax: (021) 351-1186 Website: http://www.ekon.go.id
Trade and
Investment News[1], 30 March 2009
Highlights
National
·
Politics
·
Poll
officials are considering banning open campaigning for more effective televised
debates
Terrorism
·
Prosecutors
have sought up to 20 years in prison each for 10 terrorist suspects
Security
·
Two
men have been arrested in connection with a series of grenade attacks in Aceh
Law & Order
·
An
Afghan-born US National has been arrested on charges of human trafficking
Economy
·
President
Susilo Bambang Yudhoyono will head to
Business Briefs
Macroeconomy
·
The
government has started disbursing the $6.3 billion stimulus package
·
Bank
Investment
·
State Concerns
·
Around
605,000 new jobs may come from building highways financed by the state budge
SOEs
·
PT
Jasa Marga has earmarked $407 million for capital expenditure this year
·
PT
Telkom and Telekom Malaysia Berhad have signed a cooperation agreement
Private Sector
·
Matahari
sales estimated to reach $238 million in 2009
·
PT
Prudential Life Assurancea 27.5% increase in premium income for 2008
Banks
·
Bank
Tabungan Negara will issue up to Rp1 trillion in mortgage-backed securities in
H1 2009
Power
·
Around
$43.5 million in stimulus has been disbursed to expand electricity transmission
·
JBIC
has committed $900 million in loans to increase Muara Tawar power plant capacity
Oil & Gas
·
The
government will divert 12 LNG export cargoes to the domestic fertilizer market
·
Bakrie
& Brothers plans to build a 1,200 km Kalimantan-Java LNG pipeline
Mining
·
PT
Kaltim Prima Coal will sell coal to
·
Two
state companies will $63.5 million in a
NATIONAL
Kemang in South Jakarta will be transformed into a modern city
without high-rise buildings, the head of the
Wiriyatmoko said Kemang would be developed where sidewalk
cafes, boutiques and homey restaurants lay side by side on a long street.
During the 1980s, Kemang was a quiet residential area, but
metamorphosed into commercial hub, with dozens of restaurants and bars squeezed
into the area, hounded by hordes of customers and their vehicles crowding the
streets.
The area now has some 60 cafes and restaurants as well as several
hotels.
Kemang was originally meant as a residential zone, but with
the frenzied development of the past few years, the administration now plans to
make it a legal commercial area.
Businesses in Kemang still have to pay regular fines for
converting homes into businesses. Wiriyatmoko said the administration was
studying several options, but gave no details.
“The houses will still be there, with the cafes and
restaurants trimmed along the main street. But the administration will not let
high-rise buildings be built," he said.
High-rise buildings, defined as more than eight stories tall,
are still allowed for residential purposes. A 1999 gubernatorial decree
declared the area a modern ‘kampung’.
A.Z. Harahap, head of the
POLITICS
Officials mulling ban on open campaigning
The General Elections Commission (KPU) is considering
banning open campaigning from the upcoming presidential race altogether,
calling it an outdated practice that is no longer an effective way to educate voters
on a candidates platforms, reported The
Jakarta Globe.
KPU member I Gusti Putu Artha said the KPU would "very
likely" axe open campaigning and instead hold televised debates between
presidential candidates.
The regulation will be ready for signing "sometime in
April," Artha said.
Artha said the KPU was still drafting specifics of the
debates, but under the draft regulation the program would be held five times
before the presidential election on July 9.
Under the plan, presidential candidates would debate three
times during the campaign season, while vice presidential candidates would
debate twice.
He said the KPU planned to have a moderator from the media
ask questions, adding that the KPU would allow only the press to watch the
debate. The general public would see a taped re-run.
The KPU announcement came on the heels of public criticism
of the ability of outdoor rallies to educate voters about candidates and their
platforms.
Some political observers have made the criticism that open
campaigning, which by definition involves campaigning by mobilizing a mass of
supporters on the streets or in other public spaces in order to advertise the
plans of a political party, is not an accurate measure of a party's popularity
and an even poorer measure of a candidate's ability to govern.
But open campaigning has also been credited as a good way of
getting the public involved in politics and the best method of reaching out to
poor people currently available.
The KPU gave no prior announcement regarding its plan to ban
open campaigning, but it appears that its stance is quite clear.
Artha said KPU officials were mostly in agreement regarding
the plan to ban open campaigning, a decision that will be discussed at the
commission's next plenary meeting.
He said the KPU would make its decision based on two
factors: The absence of a law regulating open campaigning by presidential
candidates and the social impacts of the method, which he said KPU officials
had agreed were mostly negative.
"Open campaigning itself began in the New Order era, as
a way to communicate party policies to the masses during a time when mass media
outlets were severely limited to the state television channel TVRI," he
said.
TERRORISM
20 years sought for
Prosecutors demanded 20 years' jail for an alleged terrorist
from
Mohammad Hasan bin Saynudin laughed and giggled as the
prosecution announced it would not seek the maximum sentence of death.
"I don't agree with 20 years. I will continue to fight
and appeal for a lighter sentence because I'm not wrong. In fact I should get a
medal for this act," he told the court.
Hasan, who claims to have met al Qaeda leader Osama bin
Laden in
"I'm not wrong and I don't regret what I did. In the
eyes of God I did nothing wrong... We only killed one idiot," he said before
the start of Tuesday's proceedings.
He has also confessed to planning to bomb
Prosecutor Totok Bambang said that as "only" one
person had been killed -- a male teacher in June 2007 -- the death penalty for
Hasan or any other members of his alleged terrorist cell was not merited.
"We would have asked for the maximum sentence if the
impact on the public was great but in this case only one person was
killed," he explained.
He said Hasan had been "proven clearly and convincingly
to have undertaken terrorist acts together with others."
"Hasan is a dangerous man... He is the brains behind
the attack (against the teacher). He planned and came up with the concept but
some of his ideas were not carried out."
The state requested sentences of seven to 15 years for six
of his co-accused who were also in court.
In seeking the sentences, it revealed that the cell had also
planned to bomb a church and the car park of the Supreme Court in
It had also decided to bomb a backpacker cafe in
The suspects were rounded up in
SECURITY
Aceh grenade attackers arrested, transferred to
Two men suspected in several grenade attacks in Aceh
province were arrested in Langsa regency on Thursday and was immediately taken
to the National Police headquarters in
According to an inside police source, one of the suspects
identified as Irwan, was involved in several grenade attacks in Bireun regency.
The suspects are being investigated for their possible
involvement in a grenade attack on the Langsa deputy regent's house after a
campaign donation for the Aceh Party, made up mostly of former separatists from
the Free Aceh Movement (GAM), was rejected by the deputy regent.
In another incident, a grenade was thrown at the home of an Aceh
Party legislative candidate in Bener Meriah regency by two unknown men on
Thursday morning.
The Jakarta Post reported that police confiscated a
grenade, a rifle and 32 rounds of ammunition from the suspects.
National Police spokesman Insp. Gen. Abubakar Nataprawira
confirmed the arrests but refused to give further details.
Nataprawira did say however National Police and Aceh Police
are conducting the so-called ‘Sikat Rencong’ operation, aimed at combating
illegal firearms and increasing grenade attacks and bombings throughout Aceh.
LAW & ORDER
An Afghanistan-born man with an American passport was
transferred to National Police headquarters on Wednesday for further
questioning in relation to an elaborate trans-national immigration scam
targeting Chinese citizens, reported Reuters.
National Police spokesman Insp. Gen. Abubakar Nataprawira
alleged that Yusuf Karim, also known as Josh Joseph, violated immigration laws
and could face six years in jail and a maximum fine of Rp30 million.
A spokesman for the Immigration Directorate General,
Maroloan Barimbing, confirmed on Wednesday that Karim had been handed over to
National Police.
He said the case stemmed from a tip-off on March 16 from the
owners of a hotel in Tangerang, Banten, where a group of Chinese migrants were
living.
“After we checked, we found the Chinese had overstayed their
30-day visas,” Barimbing said, adding the group consisted of six females and 41
males.
After being questioned by an immigration officer, the 47
Chinese migrants, currently being held by immigration officials, said they had
only planned to transit through
“They said Karim was the mastermind,” Barimbing said. “We
detained Karim on March 16 at his hotel room in
Police said the migrants came to
The migrants told police they came to
“The victims believed they would get jobs in
Smugglers often use a route through East Nusa Tenggara to
get people into
Meanwhile,
the Jambi Immigration Office on Wednesday detained seven illegal immigrants
from
According
to Jambi Immigration Office Chief Agus Mustari, the seven foreigners were
detained as they were about to board a flight to
Investigations
have pointed to a visa-for-sale scam at the Indonesian Embassy in
ECONOMY
Hopes pinned on stimulus as SBY readies for G20
Attention is now squarely on the G20 conference to be held
in
Yudhoyono told foreign investors at the
The President said "We proposed global expenditure
funds at the previous G20 meeting to assist the developing countries which are
facing funding difficulties,"
The comments made by the President indicate his desire to
progress international financial reforms with an emphasis on outcomes for
developing nations particularly in this economic climate.
The G20 comes as the central bank cut its 2009 economic
growth forecast, the second time this month, to 3%-4% percent as exports slump,
and expects inflation to ease further in March, the senior deputy governor said,
reported Thompson Financial.
The central bank had already lowered its GDP growth forecast
for Southeast Asia's biggest economy to 4% percent earlier this month, from
4%-5% percent previously
The comments came on the back of the signing on Monday of a
bilateral currency swap arrangement (BCSA) worth Rp175 trillion (nearly $14.7
billion) by the Governor of Bank Indonesia (BI) Boediono and Governor of the
People’s Bank of China (PBC) Zhou Xiaochuan.
The swap arrangement is expected to contribute to increased
trade and investment between the two states, and provide short-term liquidity
for money market stability.
On Tuesday BI Governor Boediono confirmed that BI may seek
bilateral currency swap agreements similar to the one it has signed with China
with other trading partners to manage demand for the US dollar,
Meanwhile, as a forerunner to the President’s visit to
London and as further evidence of the government’s efforts to bolster the
economy, the government also announced on Monday that its Rp73.3 trillion
($6.31 billion) stimulus package was starting to flow as scheduled.
Coordinating Minister for the Economy Sri Mulyani Indrawati
said Rp56.3 trillion worth of the stimulus had been channeled in the form of
tax incentives starting on January 1. “The effect can be seen when companies
and workers pay their taxes,” Indrawati said after a meeting with President
Susilo Bambang Yudhoyono. The tax incentives, she said, included tax cuts for
companies, workers and individuals, totaling Rp43 trillion this year.
Another Rp13.3 trillion is allocated for tax subsidies and
import duty exemption for certain labor-intensive industries. On Tuesday the
government announced that it will receive a $190 million loan from Japan to
fund programs to help improve the investment climate, alleviate poverty and
build infrastructure.
The Japanese government will also provide another loan worth
around $728 million for infrastructure development.
As the election year and campaigning heats up, major parties
promised to treat foreign investors equally, although their representatives did
not elaborate on whether they would maintain or revise business regulations.
These include the list of sectors open to foreign investment
and the limit of capital ownership, which is still being revised.
With varying emphases, the Golkar Party, the Indonesian
Democratic Party of Struggle (PDI-P) and the Democratic Party said they
welcomed foreign investment in Indonesia.
PDI-P economics advisor Iman Sugema said his party welcomes
overseas investors “as long as they are 'clean' and willing to transfer their
technology”.
By "clean", he said the PDI-P would seek "to
avoid foreign investors winning contracts just because of pressure" from
their governments.
An economic team member of President Susilo Bambang
Yudhoyono’s Democratic Party also pledged equal treatment for investors
"as long as they support our national economic interests."
In last Friday, the last trading day of the week, IHSG
jumped 3.01% or 42.772 points to 1,462.75, the highest in the last 5 months,
following growing optimism from foreign investors on Indonesian economy. IHSG
was mostly backed by commodities and infrastructures shares.
MACROECONOMY
Stimulus package starts to flow: Minister
The government announced Monday its Rp73.3 trillion ($6.31
billion) stimulus package to help boost the economy was starting to flow as
scheduled, The Jakarta Post reported.
Coordinating Minister for the Economy Sri Mulyani Indrawati
said Rp56.3 trillion worth of the stimulus had been channeled in the form of
tax incentives starting on January 1.
“The effect can be seen when companies and workers pay their
taxes,” Indrawati said after a meeting with President Susilo Bambang Yudhoyono.
BI may seek currency-swap deals with more countries
Bank Indonesia (BI) may seek bilateral currency swap
agreements similar to the one it has signed with China with other trading
partners to manage demand for the US dollar, BI Governor Boediono said Tuesday,
Dow Jones reported.
“We are open to that,” Boediono told reporters when asked if
Indonesia will seek deals with other countries similar to the three-year pact
it signed with the People's Bank of China Monday.
The Rp175 trillion-agreement with China is to help finance
trade between the two countries, which last year totaled $26.7 billion.
“The impact of the bilateral currency swap agreements (on
the rupiah) will be very good,” Boediono said.
“I am optimistic that the rupiah is more stable and will
strengthen,'” he told reporters.
The new agreement with China is on the top of the Chiang Mai
initiative, under which Indonesia can tap at least $12 billion from Japan, $4
billion from China and $2 billion from South Korea, if necessary, to defend the
rupiah.
Boediono also called for more steps to reduce dependency on
the US dollar in carrying out international financial transactions, The Jakarta Globe reported.
“It is dangerous for the world to rely on one or two
national currencies to serve global transactions,” Boediono told a news
conference at the central bank.
“With the bilateral swap transaction, settlement between two
countries can be directly done without having to convert to US dollars first,
thus it can decrease dollar dependency.”
Govt. to tender $3.5B of projects in Q2: Minister
The government plans to put four infrastructure projects
worth nearly $3.5 billion up for tender in the second quarter, including
coal-fired power plant in Central Java, the planning ministry said on Wednesday,
Reuters reported.
The four projects also include a $700 million railway
connecting Soekarno-Hatta airport to Jakarta, a $740 million railway connecting
Palaci and Bangkuang in Central Kalimantan, and a $24 million cruise terminal
in Bali.
Four other projects, worth $1 billion in total, will be put
up for tender in the second half of 2009 and early next year.
“Projects, which are ready for tender, have already had
feasibility studies and the government support, if needed,” said Planning
Minister Paskah Suzetta, adding that the government would provide guarantees for
political and natural disaster risk, as well as for land provision to attract
investors.
The projects, to be funded by the private sector, are in
addition to infrastructure deals covered by a Rp73.3 trillion ($6.35 billion)
fiscal stimulus package which is aimed at driving growth and creating jobs in
an election year.
Govt. to sell sukuk before June
The government plans to sell up to Rp7.5 trillion ($650
million) of Islamic bonds (sukuk) before June, its first global sukuk issue,
Reuters reported.
Rahmat Waluyanto, Treasury Director General at the Finance
Ministry, said the global sukuk would be issued before a Samurai bond issue
which is planned for June, and the size would depend on the underlying assets
available.
The government has already raised more than two-thirds of
its gross debt issuance target for 2009, but it wants to tap a wider investor
base using a broad array of instruments including shariah-compliant debt.
Separately, Dahlan Siamat, an official in charge of Islamic
debt at the ministry, said the underlying assets consist of government property
in Jakarta which are worth Rp7.24 trillion and in Bandung, West Java, which are
worth Rp250 billion.
The sukuk will be issued according to the ijarah contract.
Govt. raises Rp2T in debt auction
The government raised a total of Rp2 trillion ($175.8
million), in line with its target, from debt auctions on Tuesday, only about a
fifth of incoming bids as authorities angled for lower yields with much of the
year's issuance completed, Reuters reported.
The Finance Ministry has already raised about two-thirds of
its gross debt issuance target this year.
“The ministry wants to give a signal that yields are easing,
thus they are not pushing to raise more than they had expected,” said Budi
Susanto, a debt analyst at Danareksa Sekuritas.
The ministry had raised lower than the targeted Rp1.85
trillion in the last debt auction on March 10, which signaled it was less
willing to pay high yields.
INVESTMENT
Govt.
pours more funds into city’s MRT project
Jakarta city
administration received a $7.7 million grant from the central government to
speed up the construction of the city’s first-ever mass rapid transit (MRT)
project, The Jakarta Post reported.
The Director
General for Regional Financial Balance at the Finance Ministry, Mardiasmo, said
Wednesday that the grant was part of the loan from the Japan International
Cooperation Agency (JICA), the MRT project advisor.
The
central government borrowed money from JICA and later gave part of the sum to the
city as a grant.
“We will
use the grant for consultation services,” Governor Fauzi Bowo said.
The
administration has allocated Rp40 billion from its 2009 budget for the initial
work for the project.
STATE CONCERNS
State-backed road projects to soon provide 600,000 new jobs
The Public Works Ministry expects 605,000 new jobs could be
quickly created by building highways financed by the state budget, The Jakarta Post reported.
"Originally, we predicted the acceleration of national
road development would absorb 550,000 new workers. But if we add the stimulus
factor ... we can have another 55,000 workers," the ministry's Director
General for Highways Hermanto Dardak said on Wednesday.
"The stimulus package for road development amounting to
Rp1.7 trillion ($195 million) will add to our existing Rp18.7 trillion for
roads. We have submitted the project proposal to the Finance Ministry and
hopefully they can disburse the package as soon as possible," he said.
Govt. receives $190M in foreign loans
The government will receive a $190 million loan from Japan
to fund programs to help improve the investment climate, alleviate poverty and
build infrastructure, officials have announced, The Jakarta Post reported.
The Rp2.27-trillion loan, which was signed Tuesday, is
divided into two parts, each worth Rp1.13 trillion. The first part aims to
support macroeconomic development, such as reducing poverty, while the second
is aimed at improving infrastructure reform.
Krisiarto S. Legowo, the Foreign Ministry’s director of East
Asia and Asia-Pacific affairs, said the first part of the loan would be a
co-financing scheme between Japan and the International Bank for Reconstruction
and Development (IBRD).
The second, similar scheme, will be between Japan and the
Asian Development Bank, Kristiarto said, adding the requirements of the loan
included a 0.7% annual interest rate, a repayment period of 15 years and a
five-year grace period.
SOEs
Jasa
Marga sees capex of $400M for new toll roads
Toll road
operator, PT Jasa Marga, said on Wednesday it has earmarked Rp4.7 trillion
($407 million) for capital expenditure this year, four times the 2008 sum, for
expansion and share purchases, Reuters reported.
Jasa
Marga president director, Frans Sunito, told reporters that shareholders had
approved the management's plan to build eight new toll roads over the next
three to four years, at a cost of about Rp15 trillion.
Jasa
Marga plans to increase the length of toll road it operates to 700 km, from 500
km currently, as a result of the expansion.
Telkom, Telekom Malaysia sign cooperation agreement
State telecommunication company, PT Telkom and Telekom
Malaysia Berhad have signed a cooperation agreement to expand telecommunication
business in the international market, Asia Pulse reported.
Telkom president Rinaldi Firmansyah said the memorandum of
understanding signed last Wednesday would serve as a milestone for the
expansion of mutually beneficial business cooperation between the two
companies.
Research by Telkom showed that the cooperation has a
potential business value of up to Rp2 trillion ($180 million) in the next five
years.
The international cooperation will include in voice and data
services, international cable system and optimization of data centers,
Firmansyah said.
PRIVATE SECTOR
Matahari sales estimated to reach $238M
The sales of Matahari Department Store, a business unit of one of Indonesia's
largest retail companies PT Matahari Putra Prima, are forecast to reach Rp2.62
trillion ($238 million) in the first quarter of this year .
The estimated sales value is 7% higher than Rp2.45 trillion
it recorded in the same period last year and overshoots the growth target of 5%
set for the January-March period, company president Travis Saucer said earlier
this week.
In the whole of this year the company hopes to chalk up a
20% increase in sales exceeding the average growth target of 15% for Indonesian
retail industry, Saucer said.
The highest increase of 25% is recorded in the sales of
footwear, or the highest in the last three years by the company, he was quoted
as saying by Investor Daily.
Prudential Indonesia posts $583M in premium income
PT Prudential Life Assurance (Prudential Indonesia) recorded
a 27.5% increase in premium income to Rp7.02 trillion ($583 million) last year
from Rp5.51 trillion in 2007, Asia Pulse reported.
New premiums accounted for Rp3.4 trillion of the total
income, or an increase of 42% from 2007, company's chief executive officer
Kevin Holmgren said.
Holmgren said the company is set to maintain the trend by
increasing the number of its sales agents and improve distribution systems.
Vice president director and chief agency officer Rinaldi
Mudahar said with the records it made in 2008, Prudential Indonesia is the best
performing life insurance in the world, Investor
Daily reported.
Sales agent contributed 95% to the total premium income and
other systems including bancassurance accounted for the rest, Mudahar said.
Excelcomindo gets second $214M EKN loan
Cellular operator PT Excelcomindo Pratama has inked a second
deal with Swedish export credit guarantee agency EKN to secure $214 million in
loans for the purchase of Ericsson equipment from Sweden, The Jakarta Post reported.
The facility, arranged by ABN AMRO Bank N.V.'s Stockholm Branch
and Standard Chartered Bank, is the second tranche of the total $428 million
facility provided by EKN, according to a statement from the company on Tuesday.
The first loan was signed in December last year.
Loans from the facility will be used to partly finance the
company's capital expenditure this year.
Unilever Indonesia 2008 net profit Rp2.41T
Consumer goods producer PT Unilever Indonesia said Friday
its 2008 net profit rose 23% because of an increase in sales, Dow Jones
reported.
Net profit for the January to December period rose to Rp2.41
trillion from Rp1.96 trillion the previous year.
Sales rose 24% to Rp15.58 trillion from Rp12.54 trillion.
Assets at end-December at the nation's largest consumer
goods producer by sales rose 22% on year to Rp6.50 trillion.
BANKS
BTN to issue Rp1T in mortgage-backed securities
State-run Bank Tabungan Negara (BTN) plans to issue up to
Rp1 trillion ($86.39 million) worth of mortgage-backed securities within the
first half of 2009, BTN treasury director Saut Pardede said Monday, The Jakarta Post reported.
Last month, BTN issued the country’s first ever Rp100
billion of mortgage-backed securities, popularly known as KIK EBA.
Also on Monday, BTN president director Iqbal Latanro
announced the bank would cut its mortgage loan rate by 50 percentage points to
14% starting from April 1.
Bank Mandiri 2008 net profit likely up more than 10%
PT Bank Mandiri said its 2008 net profit could grow more
than 10% from the previous year, thanks to higher lending and an improvement in
net interest margin, the bank’s chief financial officer Pahala Mansyuri said on
Tuesday, Dow Jones reported.
In 2007, the bank's net profit was Rp4.4 trillion.
Total outstanding loans at end-December last year grew 26%
to Rp165 trillion, he added.
Artha Graha posts 3.7% increase in net profit
PT Bank Artha Graha Internasional reported a 3.7% increase
in net profit for 2008 from the previous year, Asia Pulse reported.
Data from Bank Indonesia showed that the publicly listed
bank recorded a 12.8% increase in net interest income to Rp429.45 billion
($35.8 million) last year.
The improved financial performance of the bank was
attributable to credit expansion with outstanding credits rising to Rp9.85
trillion from Rp7.6 trillion, the data show, Bisnis Indonesia reported.
POWER
Govt. disburses Rp500B for energy projects
The government on
Monday disbursed Rp500 billion ($43.5 million) from its stimulus package to
expand electricity transmission, but an Energy Ministry official said Rp15
trillion was actually needed to power the country, The Jakarta Globe reported.
Of the total figure,
Rp425 billion will be used to power outlying areas in Nusa Tenggara, Sulawesi
and West Java, with the remaining Rp75 billion to finance biofuel plantations
and village-level renewable energy plants in 79 independent energy villages
across the country, said Energy and Mineral Resources Minister Purnomo
Yusgiantoro.
“We expect that
construction will be finished before the end of this year,” he said, adding
that it would create almost 15,000 new jobs. “It is one way of reducing
unemployment amid the current global recession.”
Waryono Karyono,
secretary general at the ministry, said the construction of the plants in
energy-efficient villages would require about 7,600 workers, while the
construction of electricity transmission lines would absorb another 7,350
workers.
JBIC ready to finance W. Java power plant project
The Japan Bank for International Corporation (JBIC) has
expressed a commitment to extend $900 million in loans to increase the capacity
of the Muara Tawar power plant in Bekasi, West Java, state power company PT PLN
president director Fahmi Mochtar said Monday, Antara reported.
“With the expansion project, the power plant will double its
capacity to 4,000 MW from the current 2,000 MW,” Mochtar said.
"The capacity can be doubled by installing more
equipment on the existing generators and increasing gas supplies," he
said.
The expansion project is part of the government’s program to
construct the second phase of power plants with a combined capacity of 10,000
MW, he said.
OIL & GAS
Tangguh
LNG delivery may be pushed back again: Minister
The first
delivery of liquefied natural gas (LNG) from the BP-led Tangguh project in Papua
may be delayed beyond an earlier target of May, Energy Minister Purnomo
Yusgiantoro said on Friday, Reuters reported.
"We
may not make first delivery of LNG in May from Tangguh. We may deliver one
cargo to Fujian as a test," Yusgiantoro told reporters.
He said the
government had sent a team to China to check whether the receiving LNG terminal
in Fujian was ready.
"They
(China) need one cargo as a test. We can send a cargo from Bontang LNG
plant," Yusgiantoro added.
He said
Indonesia would not declare that Tangguh was on stream commercially until the
receiving terminal in China was ready.
Yusgiantoro
also said the government would target more LNG for the local market.
Govt. agrees on LNG export cuts
Indonesia will agree to Japan, South Korea and Taiwan
cutting their imports of liquefied natural gas (LNG) up to 70% of their total
contracts, Asia Pulse reported.
The three countries, which are facing a decline in LNG
requirements, have long-term contracts with Indonesia to import a total of 1.2
million tons in 18 cargoes of LNG a year.
Head of the Upstream Oil and Gas Regulator (BP Migas) Raden
Priyono said the LNG could instead be used for domestic industries.
State fertilizer factory PT Pupuk Iskandar Muda in Aceh
could use up to nine cargoes and liquefied petroleum gas (LPG) industry could
take up to six cargoes, Priyono said.
Indonesia still needs a larger supply of gas to meet growing
demand for urea fertilizer basic material and other industries.
Earlier it was reported the three countries may sell part of
the LNG they import from Indonesia to other countries.
Hari Yulianto, the vice president of the state-owned oil and
gas company PT Pertamina, said if they fail to sell the LNG, the domestic
market will have an opportunity for a larger supply of LNG, Bisnis Indonesia reported.
Medco
subsidiary eyes diverting gas to Batam
A
subsidiary of PT Medco is planning to divert as much as 49 billion British
thermal units of gas per day initially planned for a power plant in Java to a
power plant in Batam Island in Riau Islands, an official at the Energy and
Mineral Resources Ministry said on Thursday, The Jakarta Globe reported.
“The gas
may be diverted to supply a gas-fired power plant in Batam, but we haven’t
decided who will get the gas yet,” Evita Legowo, Director General for Oil and Gas
at the ministry adding the ministry would have to decide before May when the
gas is to come on-stream.
Legowo said
the gas extracted from Lematang block in South Sumatra, operated by Medco
E&P Indonesia, may flow through a pipeline belonging to state-owned gas
company, PT Perusahaan Gas Negara and its subsidiary, PT Trans Gasindo
Indonesia.
The
destination options would be either to state power company PT PLN’s power plant
in Batam or to PT Dale Energy Batam, Legowo said.
“The
receiver will have to pay for a [gas distribution] toll fee to the transporter
and BPH Migas will set the price of the fee.”
Infrastructure,
such as pipelines for transmission and distribution to support gas supplies to
power plants, was limited, and the country relies heavily on PGN’s pipeline, Legowo
said.
The
ministry plans to invite upstream oil and gas regulating body BP Migas; BPH
Migas, the country’s downstream oil and gas regulatory body; PGN, as well as
gas distributors, such as TGI and PT Pertagas, a subsidiary of state oil and
gas company PT Pertamina, to calculate how much pipe the country needs for gas
distribution networks.
“If we
already know how much capacity the country needs for the pipe and the
commercial calculations are ready, there will be a lot of investors interested
in building the pipe,” Legowo said.
Bakrie to start building gas pipeline
PT Bakrie & Brothers will build a pipeline to deliver
gas from an offshore field to a power plant operated by the state electricity
firm in Central Java, the energy minister said on Monday, Reuters reported.
The diversified group, with interests in telecoms, plantations, property and
energy, won the right from the government in 2006 to pipe gas from East
Kalimantan to Java, a distance of about 1,200 km.
Energy Minister Purnomo Yusgiantoro said this section of the
pipeline would be about 200 km and run from Java to the Muriah gas block in the
Java Sea. "This is one section of the gas pipeline from East Kalimantan to
Java," he told reporters.
Malaysia's Petronas operates the Muriah gas block and has a contract to supply
145 billion British Thermal Units (BTU) of natural gas a day for state-owned
electricity firm PT PLN for 10 years.
Siddharta Moersjid, a company spokesman, confirmed that it would build the
pipeline from Muriah to the Tambak Lorok power plant in Central Java, but did
not elaborate or give financial details.
Yusgiantoro said the gas pipeline from East Kalimantan was needed to secure gas
supply to Java in future.
Pertamina
to give Petral oil tender rights
Oil
product and crude tenders by state-owned oil and gas company PT Pertamina can
be conducted by its Singapore-based trading arm Petral after purchasing rights
were removed from a new unit, a company official said on Wednesday, Reuters
reported.
"Pertamina
had already asked Petral to do procurement and Petral can now certainly hold
tenders for Pertamina's needs for oil products and crude," said Toharso,
Pertamina's corporate secretary.
Pertamina
launched the new "integrated supply chain" unit in January to handle
all purchases of oil products and crude oil, rather than by its marketing and
processing directorates, as part of moves aimed at increasing efficiency and
transparency.
But the
company said last week the firm would give more power to Petral, while the new
unit would be relegated to being a think-tank.
A
Pertamina source told Reuters last week that the new unit did not have enough
market experience for its role.
Some
members of Indonesia's parliament had urged Pertamina to close the
"integrated supply chain" unit because they argued it added new
bureaucracy in procuring oil products and crude oil.
Pertamina,
which does not make public financial statements, has been criticized in the
past for its lack of transparency in its trading operations.
Total to build 200 fuel retail stations in Indonesia
Total SA, Europe’s third-largest petroleum company, plans to
build 200 fuel retail stations in Indonesia in five years, becoming the third
overseas company to sell fuel in Indonesia, Bloomberg reported.
“Current regulations have opened the opportunity to follow
the tender to distribute subsidized fuel,” Thierry Pflimlin, chief executive
officer of Total’s Asia Pacific unit, said in Jakarta on Monday.
"Indonesia is a big market in the region,” he said.
The Paris-based company plans to bid to sell subsidized
gasoline and diesel next year, Pflimlin said after the inauguration of the
company’s first two retail outlets in Jakarta.
MINING
KPC agrees first major China coal deal
PT Kaltim Prima Coal (KPC) last week agreed its first major
long-term deal to sell thermal coal to China, with 1 million tons to be shipped
in the first year, a top company official said on Tuesday, Reuters reported.
"It is a long-term deal for supplying coal up to five
years. In the first year we'll be supplying 1 million tons, in the second year
it will rise to 2 million tons and will go up to 5 million tons," Evan
Ball, director of KPC, said on the sidelines of a mining conference in Singapore.
He did not give any details on prices, saying they were in
line with current spot market prices.
KPC is a unit of the country's biggest miner, PT Bumi
Resources. It produced nearly 40 million tons in 2007, about a fifth of
Indonesia's total output.
China imported over 11.5 million tons of Indonesian coal
last year, accounting for more than a quarter of its total.
Antam, Krakatau to invest $63.5M in iron ore project
Two state companies will invest Rp700 billion ($63.5
million) in an iron ore project in Batulicin, Tanah Bumbu regency in South
Kalimantan, Asia Pulse reported.
Mining company PT Aneka Tambang (Antam) and unlisted steel
maker PT Krakatau Steel have established a joint venture company PT Meratus
Jaya Iron & Steel to run the iron steel processing plant.
Krakatau Steel has a 66% stake in the project and Antam has
the remaining 34%, Bisnis Indonesia reported on Friday.
The plant with a capacity 315,000 tons of sponge iron a year
is expected to be operational in 2011, Antam president Alwin Syah Loebis said.
Krakatau Engineering, a subsidiary of Krakatau Steel, has
been named contractor to build the project, Loebis said, adding that work is
already in progress in the project.
===***===
[1] This Trade and Investment News is a publication of the Coordinating
Ministry for Economic Affairs of the Republic of Indonesia. Readers are
welcomed to forward it in its original form but no reproduction is allowed
without permission.