Pertamina Appreciates Government Support for the 2023 Compensation Fund Payment

Jakarta, May 23, 2024 - PT Pertamina (Persero) appreciates the support from the government through the Ministry of Finance for accelerating the fuel compensation funds payment for the shortfall in revenue due to the set retail prices of Certain Types of Fuel (JBT) Diesel and Special Assignment Types of Fuel (JBKP) Gasoline RON 90 or Pertalite for the 2023 period amounting to IDR 43.52 trillion (including taxes) or IDR 39.20 trillion (excluding taxes).

The amount of compensation for the price difference between the formula sale price and the retail sale price at petrol stations for the JBT Diesel and JBKP Pertalite distribution has been reviewed by the Inspectorate General of the Ministry of Finance (Itjen Kemenkeu) and the Financial and Development Supervisory Agency (BPKP).

President Director of Pertamina, Nicke Widyawati, stated that the government through the Ministry of Finance has completed the payment of the 2023 fuel compensation.

"We greatly appreciate and thank the government, especially the Ministry of Finance, the Ministry of State-Owned Enterprises, and the Ministry of Energy and Mineral Resources for their support to the company by accelerating fuel compensation funds payment that Pertamina distributed in the fourth quarter of 2023. The compensation funds have been received in the company's cash reserves, and this represents the government's full support for Pertamina to maintain the continuity of subsidized fuel services, support working capital, and improve the company's financial ratios," said Nicke.

Nicke also expressed her appreciation for the full support from the government to Pertamina in maintaining the continuity of fuel distribution, including implementing the One Price Fuel program.

Pertamina appreciates the government's efforts to protect people's purchasing power by providing subsidized fuels, namely JBT Diesel and JBKP Pertalite. We urge the public to consume subsidized fuels wisely and to start using more environmentally friendly fuels as a form of support for the government.

In the current uncertain global geopolitical situation and pressure on the rupiah, prudent use and targeted distribution of fuel are necessary to help the government manage foreign exchange and the state budget.

Nicke further stated that Pertamina will continue to strive to ensure that subsidized fuel is optimally consumed by those entitled to it. These efforts include, first, using information technology to monitor real-time purchases of subsidized fuel at petrol stations to ensure that consumers buying the fuel are those who are entitled to it.

Pertamina has developed an alert system that sends exception signals and is monitored directly from Pertamina's command center. Through this system, unusual transaction data, such as filling more than 200 liters of Diesel for a single vehicle or PSO fuel being dispensed to vehicles without registered license plates, will be directly monitored by Pertamina. Since the exception signal implementation on August 1, 2022, until the first quarter of 2024, Pertamina has successfully reduced the risk of subsidized fuel misuse worth USD 281 million or around IDR 4.4 trillion.

Second, Pertamina is strengthening digitalization infrastructure and facilities at petrol stations. Pertamina is committed to digitalizing all its petrol stations, which number more than 8,000, including those in the 3T (remote, outermost, and disadvantaged) areas. As a result, 82% of petrol stations are now nationally connected. The more petrol stations are connected to Pertamina's digitalization system, the easier it will be to monitor and supervise the distribution of subsidized fuel.

Third, Pertamina continues to enhance cooperation with law enforcement agencies to increase oversight and enforcement against the misuse of subsidized fuel.

Fourth, Pertamina encourages the public to participate in the Subsidy Right Program online to identify eligible consumers and monitor the consumption of JBT Diesel and JBKP Pertalite.

Throughout 2023, Pertamina successfully controlled the distribution of JBT Diesel and JBKP Pertalite, ensuring the actual distribution was below the quota set by the government. The actual distribution for 2023 was 17.4 million kiloliters (KL) for JBT Diesel and 30.0 million KL for JBKP Pertalite.

Pertamina, as a leading company in the energy transition, is committed to supporting the Net Zero Emission 2060 target by continuously promoting programs that directly impact the Sustainable Development Goals (SDGs) achievement. All these efforts align with Environmental, Social, and Governance (ESG) implementation across all Pertamina's business lines and operations.**