fuels for another year, Indonesia’s state oil and gas company Pertamina said it plans to invest at least US$200 million in 2009 to expand and upgrade two storage terminals in East Java and Sulawesi.

The investment is needed to strengthen its distribution network in the face of growing competition after Pertamina beat out 27 other companies including Shell and Petronas for the role of subsidised fuels distributor. Those bidding for the coveted job had to prove that they own or had access to storage facilities to serve important population centres.

Pertamina said it will invest US$130 million to complete the construction of a 250,000-kilolitre terminal in Tuban in East Java, and another US$70 million on a 90,000-kilolitre terminal in Bau Bau in southeastern Sulawesi island.

The Tuban terminal is expected to be ready by end-2009 while the Bau Bau facility will likely come onstream in 2010.

Pertamina will be responsible for distributing 36.85 million kilolitres of subsidised fuels including gasoline, kerosene and diesel under the 2009 state budget.