[Kabar-indonesia] Singapore Petroleum eyes Indonesia retail marketing business

[Joyo at aol.com]

The Business Times [Singapore]
Thursday, November 2, 2006

SPC eyes retail marketing business in Indonesia

Ronnie Lim

SINGAPORE Petroleum Company (SPC) is looking at retail
marketing opportunities in Indonesia, including selling
gasoline and diesel, Koh Ban Heng, its CEO and executive
director, told BT, although it has no concrete plans at this
time to launch its Lion-logo petrol stations there.

SPC had applied for an 'oil trading licence' to do this
earlier this year, he said, after reports yesterday cited an
Indonesian Energy Ministry official as saying that Jakarta
should be giving the listed Singapore oil company a licence
soon.

Reuters quoted Erie Soedarmo, the ministry's director, as
saying: 'The government is processing the licence for SPC to
operate in the downstream business in Indonesia. I think we
will give them a licence in not too long a time.' Commenting
on this development, Mr Koh said: 'That's good news.'

Indonesia first opened up its domestic oil business,
including retail oil sales, to foreign firms in 2004. It now
allows them to directly import oil products for sale to
local customers, after revoking state oil firm Pertamina's
monopoly.

This has allowed companies like Shell and Malaysia's
Petronas to open petrol stations around Jakarta to retail
high octane gasoline, while others like BP supply oil
products to Indonesian companies.

Mr Koh said that SPC had applied for the oil trading licence
on its own. Mr Soedarmo told reporters during the country's
second major infrastructure meeting in Jakarta that SPC
planned to supply oil products to Indonesian firms PT Aneka
Kimia Raya and PT Redeco and then sell the products to some
industries.

'The Indonesian firms have storage. SPC will supply the
products and then sell them in Indonesia,' Mr Soedarmo said.
He said SPC might supply around 10,000 tonnes of oil
products a month to Indonesia if it gets a licence, but gave
no other details.

On potential partners there, Mr Koh would only say that SPC
has been in on-going business discussions with several
Indonesian parties to expand its sales of oil products in
the country.

Apart from selling oil products, Indonesia has so far proven
a happy hunting ground for SPC in its offshore oil and gas
exploration. SPC currently gets 2,300 barrels daily of oil
from Kakap in West Natuna, and expects to start production
at the Oyong oil and gas field next year.

SPC has a 40 per cent stake in Oyong, which is slated to
produce between 10,000 and 20,000 barrels per day in the oil
phase, followed by a gas phase. Under an agreement with PT
Indonesia Power, which operates a plant in Grati, East Java,
gas sales from Oyong are expected to be between 40 and 60
billion British Thermal Units per day.

Another upcoming oilfield prospect is Jeruk, although its
partner Santos had recently warned that the reserves there
are expected to be lower than the 170 million barrels figure
(or 90,000-100,000 bpd) which the Australian company earlier
cited.

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Joyo Indonesia News Service
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