LPG IN INDONESIA AT A GLANCE

Before 2007, domestic LPG consumption was limited as it was not an option to use considering its
high price. Therefore, average consumption level at 1 million metric tons (MT) per year, with the
distribution of consumption for households, commercial circles (hotels, restaurants, cafes, etc.) and
industries. In order to meet the needs of these consumers, LPG is packaged in 12 kg tubes for
household needs, 50 kg for commercial use, and LPG bulk / bulk for industry. During the time, most
of the fuel consumption for household was dominated by kerosene instead of LPG since the kerosene
was subsidized by Government while LPG was not subsidized. Therefore, its price was much cheaper
than LPG.

But along with the problems faced in the supply of energy, where the fuel subsidies for kerosene are
getting bigger and bigger. Since 2007, the Government had been conducting new national energy
policy by implementing conversion program from kerosene to LPG since it is cheaper. With
consideration of being more economical and easy to distribute, the program had been carrying out in
the form of 3 kg and is still in under subsidy scheme. The program is being intended for household
with majority of middle lower income and small business in all regions of Indonesia who previously
use subsidized kerosene.

Pertamina as stated-owned company plays an important role energy development in Indonesia.

Pertamina was appointed to run subsidy fuel program under Public Service Obligation (PSO) since
kerosene and now LPG. Unless some eastern Indonesia (Papua, Maluku, Nusa Tenggara), the
program has covered all provinces in Indonesia and continues gradually.

Total PSO Non PSO

Consumption Consumption Consumption
Year (Million MT) (Million MT) (Million MT)
2003 1.0 1.0
2004 1.1 1.1
2005 1.0 1.0
2006 1.1 1.1
2007 1.3 0.0 1.3
2008 1.8 0.5 1.3
2009 2.9 1.8 1.2
2010 3.8 2.7 1.0
2011 4.3 3.3 1.1
2012 5.1 3.9 1.2
2013 5.6 4.4 1.2
2014 6.1 5.0 1.1
2015 6.4 5.6 0.8
2016 6.6 6.0 0.6
2017 7.2 6.3 0.9
2018 7.6 6.6 1.0
AMANAH INDO GAS BUSINESS

There are some challenges while Pertamina was mandated to implement Public Service Obligation for
LPG refill nationwide. One of the challenges is the natural state of Indonesia in the form of a vast
archipelago. LPG infrastructure must be prepared to cover all Indonesia area which consists of so
many islands. LPG conversion area spread from the crowded city to the villages with small
population. LPG packages delivered to the fishermen in the seaside and also to the farmer in the
deep forest.

In order to accelerate conversion program, Pertamina besides having its own infrastructures and
facilities, also involves the private sector to build facilities and infrastructure to support subsidized
LPG distribution. One of the required infrastructures is LPG Filling Plant (Bottling process the LPG).
LPG Filling Plant owned by private sector has the duty to transport, fill, and deliver LPG in the form of
tubes or bulk to distributors appointed by PERTAMINA. LPG is taken from PERTAMINA LPG Terminal,
Refinery, and Gas Field. LPG stock in Filling Plant belongs to PERTAMINA (consignment system). On
this business area Amanah Indo Gas runs its business.

The ownership