JAKARTA – The Downstream Oil and Gas Regulatory Agency (BPH Migas) said that Solar diesel fuel will exceed the quota set in the 2019 State Budget, due to inappropriate distribution.

BPH Migas chief M Fanshurullah Asa said that based on their data, collected together with PT Pertamina (Persero) and Hiswana Migas, subsidized Solar distribution as per June 2019 was over quota by 50%. This was caused by surging consumption in a number of cities—exceeding the limit given.

“Our focus is to control Solar diesel fuel consumption volume that is predicted to exceed quota. BPH Migas and Pertamina have repeatedly predicted the volume to exceed the 14.5 million Kilo Liter (KL) quota. For Solar, the over quota is estimated at around 0.8mn KL to 1.3mn KL. During a BPH Migas committee meeting, we agreed to control this,” Fanshurullah said at BPH Migas office building on Wednesday (8/21).

According to Fanshurullah, the over quota was caused by excessive consumption by consumers in the business sector—especially mining companies. At least 10 provinces are suspected to have experiences an unnatural increase in diesel consumption: East Kalimantan, Riau, Riau Islands, Lampung, West Sulawesi, North Sulawesi, West Sumatra, South Sulawesi, East Java and Bangka Belitung.

The biggest over quota is in East Kalimantan with a consumption rate of 124.6% month-to-month. It is followed by Riau Islands (119.9%), Lampung (113%), Riau (111%), Southeast Sulawesi (109.4%), West Sulawesi (109.2%), West Sumatra (108.8%), South Sulawesi (108.8%), East Java (108.7%), and Bangka Belitung (108.3%).

Verification by BPH Migas shows that the consumption of Solar diesel fuel as per July 2019 had reached 9.04 million Kl or 62%. At the end of the year, the volume is projected to reach 15.31 million to 15.94 million Kl, reflecting a potential over quota of 0.8 million to 1.4 million Kl, or 5.5% to 9.6%.

According to Fanshurullah, the sectors that use subsidized fuel excessively and causing the excess quota is plantation and mining sectors. The fact is, both sectors are not allowed to use subsidized Solar, and must only use diesel fuel for industries.

“This is in mining and plantation industry areas that are thriving,” Fanshurullah said.

BPH Migas has issued a circular regarding solar fuel purchase requirements, effective since August 1, 2019. The circular’s content is as follows:

1. Prohibiting the use of Solar Diesel Fuel for motorized vehicles used as transportation for plantation, forestry and mining products with more than 6 (six) wheels; loaded or unloaded.

2. Limiting the purchase volume of Solar Diesel Fuel for 4-wheeled transportation to a maximum of 30 liters per vehicle per day. A maximum of 60 liters/vehicle/day for 6-wheels transportation, and 20 liters/vehicle /day for personal transportation.

3. Prohibiting the use of Solar Diesel Fuel for motorized vehicles with red licensed plates, TNI/Police officers’ vehicles, and government-owned water transportation.

4. Prohibiting the use of Solar Diesel Fuel for motorized vehicles for fuel tank vehicles, CPO, dump trucks, trailer trucks, articulated trucks and cement mixers.

5. Prohibiting the use of Solar Diesel Fuel for consumers of micro business users, fisheries businesses, agricultural businesses, water transportation using outboard motors and public services, without a recommendation letter from an authorized institution

6. PT Pertamina (Persero) must regulate the location of fuel stations that distribute Solar Diesel Fuel by taking into account the distribution of consumers and users, as well as regulating the allocation for each gas station.

7. PT Pertamina (Persero) is mandated to provide non-subsidized fuel types (Pertamina Dex and Dexlite) to anticipate long lines of customers at gas stations.

8. Requesting PT Pertamina (Persero) to coordinate with provincial and regional governments, the TNI and the police, to monitor the sale and distribution of Solar Diesel Fuel. (RI)