The Chairman of Indonesian Oil and Gas Entrepreneurs Association (Hiswana), Eri Purnomohadi, said at a business forum in Jakarta on Thursday the current price of gas fuel no longer had economic value.
"With only Rp3,100 per liter of equivalent premium gasoline, gas fuel is difficult to develop as the companies do not make any profit at such a low price," Eri said.
Eri explained that the domestic private oil and gas companies buy raw gas at 4.72 U.S. dollar per MMBTU. It meant that with the currency exchange rate of Rp12,000 per U.S. dollar, the company had to buy at Rp2,020 per liter of equivalent premium gasoline.
"And Rp1,080 is used for investment component, operation and maintenance, taxes and margin," he said.
Eri added that the gas fuels price hike would also make the market more competitive, as the consumers would compare it with the subsidized premium gasoline price, which is Rp6,500 per liter.
"The gas price will be ideal at Rp4,500 per liter of equivalent premium gasoline, and later the consumers will choose it considering its low price," Eri explained.
Agreeing with that opinion, a member of the National Energy Council, Herman Agustiawan, said the price mechanism of gas oil must benefit both the company and the consumer.
"If not, gas fuel cannot be developed significantly in terms of the national energy utilization," Herman said.(*)
Editor: Heru Purwanto
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