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Pertamina: Pertamina’s Commitment to Carry out Productive and Profitable Investments for the State

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PT Pertamina (Persero) strives to provide the best performance for Indonesia. Under President Director of Pertamina, Nicke Widyawati, Pertamina managed to make several positive achievements for Indonesia.

From 2018 to 2020, the state-owned oil and gas company recorded a profit of USD 6.1 billion. In 2018-2019, Pertamina made a profit in the range of USD 2.5 billion.

“In 2020, Pertamina faced a triple shock as a result of the pandemic. However, Pertamina managed to record a profit of USD1.1 billion,” said Pertamina VP Corporate Communication Fajriyah Usman, Tuesday (1/2/2022).

Fajriyah said the profit achievements show the extraordinary performance of all Pertamina management and workers during the Covid-19 pandemic. During the challenges of the pandemic, Pertamina has consistently operated all of its production activities from upstream to downstream, as well as mobilizing all business partners in Pertamina’s business ecosystem and the Indonesian energy sector.

“Almost all companies in the world have felt the negative impact of the pandemic. Most of the global oil and gas companies have experienced losses and laid off many workers,” said Fajriyah.

Pertamina has also received recognition from the world. Three international credit rating agencies show that Pertamina can manage its finances and investments wisely so that it is included in the healthy company category.

Until now, Pertamina has recorded a well-maintained debt ratio. Pertamina is also competitive among other national and international oil and gas companies. Thus, the international rating agencies, namely Moody’s, S&P, and Fitch, assigned Pertamina an investment-grade rating of baa2, BBB, and BBB, respectively.

“This shows the credibility and trust of investors in Pertamina, which is increasing from time to time,” said Fajriyah.

In 2020, the company has completed three corporate loans totaling USD549 million. Meanwhile, in 2021, Pertamina can pay its debt obligations of USD391 million.

“So the assumption is not true that Pertamina cannot pay its obligations. Currently, Pertamina is one of the healthy, productive, and efficient Indonesian companies during the COVID-19 pandemic,” said Fajriyah.

Pertamina carries out various broader business developments to realize the aspiration to become a global energy champion. Similar to most business entities, strong capital support from several sources is needed to finance assignments and future growth. One of the external funding sources is through strategic partnerships, loans to financial institutions, and the issuance of bonds.

“Currently, Pertamina’s debt to equity ratio from a financial perspective is still within reasonable limits as a healthy company. Likewise, the mechanism carried out still refers to existing regulations,” said Fajriyah.

International recognition of Pertamina’s financial performance can also be seen in its achievement as the only Indonesian company in the Fortune Global 500. With this financial performance, Pertamina increased the Government’s revenue by almost IDR 200 trillion in 2020 from tax and dividend payments, revenue Non-Tax State (PNBP), and state revenues from Crude Oil and State Condensate (MMKBN) from Pertamina’s oil and gas blocks.

“We are committed to carrying out excellent operations, achieving positive growth, and at the same time continuing to contribute to the nation,” she said.

Meanwhile, related to refinery development projects, since 2018, Pertamina has been aggressively speeding up existing refinery projects with accurate and careful calculations. It includes the Balongan Refinery Development Master Plan (RDMP) project, which will provide additional production capacity from 125,000 barrels per day to 150 thousand barrels per day in April 2022.

Meanwhile, the Balikpapan RDMP refinery project will reduce the oil and gas balance deficit to USD 2.65 billion per year. It is because the refineries can produce high-quality products such as gasoline (Pertamax Turbo, Pertamax, Pertalite) with Euro 5 quality and propylene, a petrochemical product whose demand is still very high. Pertamina is optimistic that the Balikpapan RDMP project will be completed in 2024.

In 2020, Pertamina also succeeded Rokan Block transfer management on August 9, 2020, through PT Pertamina Hulu Rokan (PHR). Pertamina is proven able to maintain the superior performance of the Rokan Working Area (WK). From August 2021 to December 2021, PHR WK Rokan managed to drill 90 tajak wells and increase the production level of the second-largest oil and gas WK in the country.

From the production side, PHR WK Rokan has reached a production level of around 162 thousand BOPD (barrels of oil per day) or an increase of 4 thousand BOPD compared to before the management transfer, which was in the range of 158 thousand BOPD. The activities of drilling new wells and reworking old wells are continuously carried out to increase production.

The production of PHR WK Rokan contributes about 25% of the total national oil production and is one of the backbones of efforts to achieve the national production target of 1 million barrels of oil per day (BPD) and 12 billion cubic feet of gas per day (bscfd) by 2030.

In the first two months after the management transfer, PHR WK Rokan also contributed state revenue through the state’s share of crude oil of around IDR 2.1 trillion and tax payments of around IDR 607.5 billion, including taxes to the regions.

“The superior performance of PHR WK Rokan is certainly essential supporting the fulfillment of national energy needs, state and regional income, as well as achieving Pertamina’s vision to become a world-class national energy company,” said Fajriyah.

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