Oil and Gas Holding Company Strengthens National Gas Business
Thursday, 31 May 2018 | 22:36 WIB
The establishment of oil and gas holding company will optimize the gas business in Indonesia.
JAKARTA, NNC - The establishment of oil and gas holding company will optimize the gas business in Indonesia, among others through the optimization of gas supply and improvement of gas infrastructure efficiency, thus creating competitive gas prices.
Exemplifying the holding company of oil and gas in other countries, the integration of gas business is aimed at strengthening Pertamina Group as the holding company of oil and gas.
On April 11, 2018, Pertamina has officially become the holding company of state-owned oil and gas enterprises. Oil and gas holding company is authorized through the signing of the Agreement of Transfer of Right to the State of the Republic of Indonesia to PT Perusahaan Gas Negara Tbk or PGN in the framework of Equity Participation of the Republic of Indonesia to Pertamina. With the Deed of Transfer of Shares, PGN officially became a subsidiary of Pertamina.
Vice President Corporate Communications of PT Pertamina (Persero) Adiatma Sardjito said the formation of oil and gas holding company will make the management of the national gas business more effective and efficient, thereby increasing the value of the gas business as a whole. "The rise in the value of gas business is triggered by the integration of commercial business and gas infrastructure from upstream, midstream and downstream business," he said.
Furthermore, integration will also implement joint marketing and sales, as well as increased effectiveness and cost efficiency of operations and investments. In addition, the strengthening of capital structure from investment capacity improvement, as well as integrated and coordinated approach to the regulator.
Adiatma added that based on world best practice, national oil companies (NOC) serve as the sole main player of oil and gas business covering oil and gas production, export and import, transmission infrastructure, and distribution and marketing.
This indicates NOC is formed into oil and gas holding company to enlarge and strengthen the oil and gas management of the country. A number of integrated NOC worldwide include Petrobras of Brazil, PTT of Thailand, Petronas of Malaysia, Gazprom of Russia, Pemex of Mexico, and Rosneft of Russia.
Thus, according to Adiatma, the government can monitor the supply and development of oil and gas infrastructure to ensure access to oil and gas for all consumers, ensuring the availability of oil and gas for consumers at fair prices and optimal use of monetary resources for infrastructure.
"Holding company of oil and gas in the country is indispensable because of the huge oil and gas investment needs and future market challenges. With the entry of PGN in our subsidiaries, Pertamina as oil and gas holding company can realize the ideals of energy sovereignty," explained Adiatma.