Indonesia's refined products stockpiles fall below 20-day target

Jakarta (Platts)--13May2005

Indonesia's fuel stockpiles had fallen to 19 days as of May 11, below the 20
days minimum floor targeted by the government, according to documents obtained
by Platts Friday. Stocks had fallen as suppliers have held up deliveries while
the state company has struggled to pay banks to provide necessary letters of
credit. A vessel carrying 600,000 bbl of gasoil was demurred in each of Teluk
Semangka and Kalbut, both in Sumatra. Another unidentified vessel carrying
200,000 bbl of gasoline was demurred in Singapore due to problems Pertamina is
having making payments. The May 11 stockpiles included gasoline stockpiles of
15.6 days, kerosene 24.8 days, gasoil 15.2 days, diesel fuel 36 days, and fuel
oil 27.4 days. Previously, Indonesia's minister for energy and mines, Purnomo
Yusgiantoro had said it was dangerous for the stockpiles to fall below 20 days
"because it can be [depleted] quickly and cause a rush [of demand]." The
document further suggested that if Pertamina should resolve issues with
letters of credit, fuel stockpiles could return to 20.9 days by end-May.

Meanwhile, industry sources expected Pertamina to face mounting demurrage
claims from its crude and products suppliers, who have been holding back the
discharge of cargoes while waiting for delayed letters of credit from the
company, Platts reported Wednesday. Suppliers were adamant about not
discharging their cargoes unless they had received an "acceptable" letter of
credit. "Some crude deliveries have arrived but are not being discharged and
we will make demurrage claims against Pertamina for any delays," said one spot
crude supplier. Meanwhile Pertamina had received word that the government
would pump funds into the company's coffers every ten days to help tide it
over its current financial difficulties, sources at the company said
Wednesday. The government owed Pertamina Rupiah 24-trillion ($2.5-bil) in fuel
subsidies for the first quarter of this year, which it began paying in
installments during April. The first tranche of Rupiah 4.1-trillion was paid
up last month, followed by another Rupiah 3.3-trillion this Monday.

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