Pertamina to be Holding Company in Indonesian Oil, Gas Sector

Indonesian government is finalising the process to create holding companies for state firms in oil and gas, mining, financial services and food sectors.

The government is looking to revise Government Regulation (PP) No. 44 to include new articles on state asset management in favor of the establishment of the super holding, reported Jakarta Post, a local newspaper.

“We are discussing the regulations needed over the whole process to ensure that the state will remain the manager of the future state-owned enterprise [holding company],” State-Owned Enterprises (SOEs) Minister Rini Soemarno said on Thursday.

Pertamina will be the holding company in the oil and gas sector. It is likely to acquire state-run gas firm PGN as its subsidiary, Soemarno said. PGN will later be expected to acquire Pertamina’s subsidiary Pertamina Gas (Pertagas) in order to prevent any possible overlaps in work areas.

The government expects that the future energy holding company will increase efficiency and eliminate duplications of investment between state-run energy firms.

After the forming of the energy holding company, Pertamina’s total investment until 2021 is expected to reach $1.5 billion, so that infrastructure for gas supply can be developed faster, the newspaper quoted a company official as saying.