Pertamina Group Synergizes to Initiate Carbon Trading

October 18, 2022 - Pertamina initiates a carbon trading pilot project between sub-holdings. Namely, Pertamina NRE, Subholding Upstream (PHE), and Subholding Refinery & Petrochemical (KPI). The collaboration was marked by heads of agreement (HoA) signing at the G20 State-owned Enterprises International Conference in Nusa Dua, Bali (18/10).

The signing was carried out by the President Director of PHE, Wiko Migantoro, President Director of KPI, Taufik Adityawarman, and Pertamina NRE CEO, Dannif Danusaputro. It was witnessed by Deputy Minister of BUMN I Pahala N. Mansury and Director of Portfolio Strategy and Business Development A. Salyadi Saputra.

On this occasion, the President Director of PT Pertamina Hulu Energi (PHE), Wiko Migantoro, explained that for PHE, ESG is a new opportunity for the company to provide more benefits to the environment and society. "This decarbonization strategy is an inseparable part of ESG. This ESG commitment has been proven through the acquisition of an ESG rating which has managed to get a rating of 24 out of 254 global oil-producing companies," he explained.

"This decarbonization is PT KPI's ESG implementation in reducing carbon emissions to support Sustainable Development Goals No 13 regarding Climate Change Management to take quick action to address climate change and its impacts," added President Director of PT Pertamina Kilang Internasional, Taufik Adityawarman.

Pertamina's internal carbon trading is part of the Pertamina Group's decarbonization efforts and the net zero emission (NZE) roadmap. In this initiative, PHE and KPI, as companies that produce carbon, will buy carbon credits from Pertamina NRE. PT KPI also applies the principles of excellent operation, including energy efficiency and other production process efficiency, to support decarbonization.

"Pertamina NRE, as Pertamina's spearhead in the energy transition, is ready to oversee decarbonization efforts within the Pertamina Group. The signing of this HoA is a good start for Pertamina Group's carbon trading collaboration, and we are very enthusiastic to collaborating with other sub-holdings to support net zero emissions," said Dannif on the same occasion.

In this initiative, PLTP Lahendong Units 5 and 6 were appointed to be the source to compensate for these carbon emissions. The Lahendong PLTP is located in Lahendong, North Sulawesi, one of the geothermal areas managed by Pertamina Geothermal Energy (PGE), a subsidiary of Pertamina NRE. PLTP Lahendong Units 5 and 6 is one of PGE's CDM projects that has held the Verified Carbon Standard (VCS) since 2018.

PHE, the Upstream Subholding, is PT Pertamina (Persero) subsidiary which manages the upstream oil and gas business in domestic and international work areas. PHE has been registered in the United Nations Global Compact (UNGC) as a participant/member since June 2022. PHE is committed to the Ten Principles of UNGC in its strategy and operations as part of ESG implementation. PHE will continue to develop professional operations management at home and abroad to become a world-class oil and gas company that is environmentally friendly, socially responsible, and has good governance.

PT KPI is the Subholding Refining & Petrochemical of PT Pertamina (Persero), which manages Pertamina's Oil and Petrochemical Refinery. As one of the company's ESG (environmentally friendly, socially responsible, and good governance) implementation initiatives, PT KPI has set a long-term goal to gradually reduce carbon emissions in order to reach Net Zero Carbon in 2060. It will support environmental sustainability in the future.

Pertamina is fully committed to implementing ESG and supporting Sustainable Development Goals. The carbon trading initiative is part of the NZE roadmap to minimize the impact of climate change.**