PT AKR Corporindo Tbk was awarded the rights to distribute subsidized Gasoline RON 88 (AKRA 88) and High Speed Diesel (AKRA SOL) in 2009 by the Republic of Indonesia through its Downstream Oil and Gas Regulator, BPH Migas. This was based on AKR's strong business infrastructure, excellent relationship with major international oil companies and strong financial performances. AKR is also noteworthy on its reliable supply of fuel and chemcal products given the strategic location of its terminals and large fleet of transport in the country. It is the first private company entrusted by the Government to distribute subsidized fuels in the country.
Fuel subsidy in Indonesia has reached to about 45 million KL in 2012 and is expected to increase in the following years. The limited number of PSO contrasted by the large demand for subsidized fuels give opportunity to increase further the network of PSO in the country. Since the Government requires strict controls in the distribution process, AKR was awarded rights to distribute subsidized fuels because of its reputation of having high quality products, large fleet of transportation and the continous enhancement of its information technology that ensures better control in its terminals, land and sea transports, and PSO network.
AKR's retail network has grown to 31 PSO outlets located in 6 provinces in North Sumatera, Lampung, West Kalimantan, South Kalimantan, East Kalimantan and South Sulawesi. In 2013, AKR was awarded an allocation of 267,892 KL of subsidized fuel volume, 160% from last year. To sustain this level entrusted by the Government, AKR will open 15 additional SPBU and SPDN (PSO for fishermen) outlets to increase its distribution capability in the country. By the end of the second quarter, the company will have a total of 46 PSO outlets.
The continous efforts to efficiently distribute subsidized fuels in the country, the Government announced additional 613,000 KL of subsidized fuel reserves and will be awarded to private companies this year. AKR is participating to achieve a significant share of the reserves and will continously build more PSO outlets to strenghten its distribution capability in the country.
AKR is also looking in various areas in the country to build SPBU for non-subsidized products. Studies are being conducted to identify market areas with customers who are in the truck-hauling and heavy equipment businesses given the Government's strict regulation to eliminate sales of subsidized fuels to these type of huge vehicles serving the industrial sector.
The growth of the retail business of AKR opens more opportunities to interested investors. The company has been known for its stable and reliable supply of quality petroleum products and bulk chemicals. Its strategic network of terminals and PSO outlets, large fleet of inland and sea transport, its advanced information technology, strong financial performances and high regard on safety, health and environment ensures its clientele a sound and profitable business.