The government had asked Pertamina to review the plan, Pertamina spokesman M Harun said here on Thursday.
"Given the request, Pertamina has decided to postpone a 10 percent rise in the price of LPG in 50-kg cylinders which was originally scheduled for early July," he said.
Director General of Oil and Gas at the Energy and Mineral Resources Ministry Evita Legowo said the government had not approved the plan for fear it would encourage consumers of LPG in 50-kg cylinders to turn to subsidized LPG in 3-kg canisters.
"The government must consider all aspects. So it is not that easy," said Evita who is also a member of the company`s board of commissioners.
Harun said Pertamina intended to raise the price of LPG in 50-kg cylinders because it wanted to share the losses from the sales of LPG in 50-kg cylinders with industries as users.
"As such, Pertamina, together with industries can contribute to the national economic growth," he said.
LPG in 50-kg cylinders is currently priced at Rp7,355 a kg, lower than the market price of more than Rp9,000 a kg.
Pertamina earlier proposed two options to cover the losses from the sales of LPG in 50-kg cylinders. The first option was that the government raised the price of LPG in 50-kg cylinders by 10 percent at the end of June and that of LPG in 12-kg cylinders in September 2011.
If the government did not approve the first option, Pertamina would ask the government to subsidize LPG in 12-kg and 50-kg cylinders.
Pertamina is expected to suffer Rp3.6 trillion in losses this year if the prices of non-subsidized LPG are not raised.
(T.K007/S012/H-NG/A/O001)
Editor: Priyambodo RH
Copyright © ANTARA 2011
