The Downstream Oil and Gas Regulating Agency (BPH Migas) will conduct a direct appointment for the company which will be responsible for the distribution of fuel in Indonesia beginning 2010. It estimates that the volume of subsidized fuel oils in 2010 may reach 34.9 million kiloliters consisting 20.6 million kiloliters of premium gasoline, two million kiloliters of kerosene and 12.3 million kiloliters of diesel oil. This marks a slight decrease from the amount of subsidized fuel oils in the 2009 state budget which was set at 36.85 million kiloliters consisting of 19.4 kiloliters of premium gasoline, 5.8 million kiloliters of kerosene and 11.6 million kiloliters of diesel oil.
The assignment of a company for the distribution of subsidized fuels with a direct appointment is permissible by Presidential Decision No. 71/2005. However, the Head of BPH Migas, Tubagus Haryono, said that the corporate body which will be appointed directly has to meet certain commercial, financial, technical and administrative requirements. Moreover, he also revealed that the direct appointment will be carried out on a regional basis. For that purpose, BPH Migas had already prepared a mechanism for the direct appointment of a company which will provide and distribute subsidized fuel oils in 2010. On the other hand, Ismayatun, a member of House Commission VII, warned that the appointment must be carried out transparently or questions may be raised. MF
As published in MKK newsletter June 2009
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