REPUBLIKA.CO.ID, JAKARTA -- The state-owned oil and gas company Pertamina forecast that the previously planned net profit at US$3.44 billion will drop to US$3.21 billion for the year 2014.
On Monday, Pertamina President Director Karen Agustiawan notified the press that the profit target dipped after it revised the price hike of the non-subsidized 12-kg liquefied petroleum gas (LPG) cylinders.
Agustiawan noted that Pertamina had previously set a profit target of US$3.44 billion for 2014, up 13.17 percent, from US$3.04 billion in 2013.
"But, with the revision in the price hike of 12-kg LPG cylinders, the net profit in 2014 is predicted to rise by only 5.65 percent or US$3.21 billion," remarked Pertamina's president director.
She called the press conference after Pertamina's shareholders held a public meeting to discuss the LPG price hike.
Pertamina will reduce the price hike for the non-subsidized 12-kg LPG cylinder from Rp3.9 thousand to Rp1 thousand per kilogram, after receiving extensive criticism from the government and people.
"After seeking consultation with the officials of the Supreme Audit Agency (BPK), the price of 12-kg LPG cylinders will be lowered to Rp82 thousand from the previous price of Rp117 thousand. The price change will become effective from January 7," State-Owned Enterprises Minister Dahlan Iskan stated here on Monday.
The decision was taken following mounting protests after PT Pertamina hiked the gas price earlier this month, without evaluating its social and economic repercussions.
Meanwhile, PT Pertamina defended its decision to increase the gas price as it will continue to suffer significant losses if it kept selling gas at the rate of Rp8.1 thousand per 12-kg LPG cylinder.
Minister Dahlan remarked that the increased gas price will not significantly reduce Pertamina's losses.
"Prior to the gas price hike, Pertamina suffered a loss of Rp7.7 trillion per year. However, with the current decision to increase the gas price by Rp1 thousand per kilogram, the loss will be reduced to Rp6.5 trillion per year," Dahlan pointed out.
The ruling Democratic Party (PD) has commended the state-owned oil and gas company Pertamina for re-assessing its recent decision to raise the price of the 12-kg gas cylinder by 68 percent.
"The PD welcomes Pertamina's decision to revise its previous price hike from Rp117,708 per 12-kg LPG cylinder to Rp82.2 thousand per 12-kg LPG cylinder," PD Spokesman Mohamad Ikhsan Modjo noted here on Monday.
Previously, Pertamina decided to increase the price of LPG by 3.9 thousand per kg. However, following widespread public protests, the state-owned company had to limit the increase to only Rp1 thousand per kg.
Ikhasan noted that the revision in the price hike mirrored Pertamina's positive intent towards the people of the country.
"This is a gesture of a pro-people policy, which takes into account its impact on inflation and the prosperity of the people," he remarked.
He claimed that the revision of the price hike also reduced the price disparity between the subsidized LPG in 3-kg gas cylinders and the non-subsidized LPG in 12-kg gas cylinders.
Pertamina has earlier hiked the selling price of non-subsidized 12-kg LPG cylinders by about 68 percent, effective January 1, 2014.
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