PERTAMINA READY TO MARKET 5.5-KG LPG CYLINDERS

By Andi Abdussalam           Jakarta, Sept 19 (Antara) - State-owned oil and gas company Pertamina is now ready to market its 5.5-kilogram (kg) cylinders of liquefied petroleum gas (LPG) in Jakarta and its satellite towns of Depok, Tangerang, and Bekasi from October 1, 2015.          "The 5.5-kg LPG cylinders will be officially launched on October 1, 2015. They will be sold only in Jakarta and its satellite towns of Depok, Tangerang, and Bekasi (Jadetabek)," External Relations Manager of PT Pertamina's Marketing Operations for Region IV (Central Java and Yogyakara), Roberth M.V. Dumatubun, stated in Semarang, Central Java, on Friday.           According to Pertamina's plan, the target consumers of the 5.5-kg LPG cylinders are the middle and upper class people such as apartment residents who do not consume LPG in large volumes.          "Apartment residents are a market segment and rarely carry out cooking activities. For apartments, particularly with women residents, the 5.5-kg LPG cylinders are suitable as the apartment residents can carry the cylinders themselves since they are not too heavy such as the 12-kg variant," he noted.          The non-subsidized 5.5-kg LPG cylinders, which are packed similar to the 12-kg sized Bright gas cylinder, will be sold at a price of Rp80 thousand per cylinder.           Earlier, Pertamina Marketing Director Ahmad Bambang had remarked in Jakarta that his office had made intensive preparations for the launch of Pertamina's new 5.5-kg gas variant to provide a viable alternative to consumers.          "Just wait until next month as I am still conducting a survey to finalize its logo. We want its logo, size, and color to attract consumers. Its color can be pink, orange, or purple. The survey to decide the shape of the cylinder is still being conducted, whether it should skinny, slim, or chubby," Bambang stated after the signing of an agreement between PT Pertamina and PT Adaro Energy at Pertamina's headquarters last Friday, on September 11.     The design of its logo and cylinder will be based on feedback received from consumers, and Pertamina is conducting a survey to collect this information. Hopefully, the 5.5-kg LPG cylinders will be launched in the market early in October, he remarked.         He affirmed that the target consumers for the new LPG variant are middle class people such as those residing in apartments.         "We want to be more specific and create products specially catering to the needs of apartment residents who have no piped gas connection. It will be difficult for apartment residents to carry 12-kg gas cylinders as they are heavier. However, they should also not opt for the 3-kg gas canisters as this size is only meant for the lower class people" Pertamina's marketing director pointed out.      Besides this, the 5.5-kg gas cylinders are also expected to attract consumers of 3-kg cylinders who will actually be able to buy a bigger size gas cylinder.         "Our target is the middle class consumer. Now, many middle class consumers are opting for the 3-kg gas canisters," he stressed.          Bambang expressed hope that the new gas variant in the form of 5.5-kg cylinders would be able to attract consumers that currently use 3-kg gas cylinders.          "We do not need to sell it at a higher price for the time being, and what is important is to attract consumers first," he added.         He said Pertamina had also lowered the price of its 12-kg LPG cylinders in the range between Rp6.4 thousand and Rp17 thousand per cylinder, effective since September 16, 2015.         The rate of price decline is based on the historical data of LPG prices in line with the contract reference price of Aramco and the US dollar currency exchange rate against the rupiah.         "The movement of the two indicators (reference price and currency fluctuation) is also taken into account," he noted.         Bambang stated that the prices of LPG at the dealer level varied between Rp132.8 thousand and Rp157.4 thousand per cylinder. It depends on the distance between the dealer's location and the refilling station and the LPG bulk transportation points or from its supplier points (SPPBE).         At the national level, the average price of a 12-kg gas cylinder has been lowered to Rp135.3 thousand, down by Rp6.7 thousand from the previous price of Rp142 thousand.         For Jakarta, Bogor, Depok, Tangerang, and Bekasi (Jabodetabek) areas, the price of a 12-kg gas cylinder was lowered by Rp6.4 thousand from Rp141 thousand to Rp134.6 thousand.         For consumers in East Java, the price of the 12-kg gas cylinder was reduced by Rp6.4 thousand.         "Price adjustment has also been carried out for other non-public service obligation (PSO) gas types, with an adjustment price that is not very different (from the 12-kg size)," he pointed out.          According to Assistant Manager for External Marketing Operations of Region V Heppy Wulansari, the drop in LPG prices came into effect on September 16 along with the declining global oil prices.          "With the change in LPG prices, the selling price of 12-kg LPG cylinders at the agent level in East Java ranges from Rp133.3 thousand to Rp137.1 thousand," she noted.          LPG prices at the consumer level in several districts and municipalities in the province will vary, depending on the distance between the supply point or depot location and the consumer's residence, she affirmed.        To anticipate disparities in LPG prices in districts and municipalities, the company has set a retail price at gas stations, which serve as an outlet for 12-kg LPG cylinders, she said.        "The move is aimed at enabling gas stations to play the role of a barometer for the price of 12-kg LPG cylinders as well as to anticipate the possibility of retailers setting LPG prices illegally," she added.    ***3***(T.A014/INE/B003)EDITED BY INE (T.A014/A/BESSR/Bustanuddin) 18-09-2015 17:26:40