Indonesia's Pertamina studying risks of importing Russian crude

JAKARTA (Reuters) - Indonesia's energy firm PT Kilang Pertamina Internasional is reviewing the risks it may face if it purchases crude oil from Russia, its chief executive said on Thursday, amid rising energy demand and a ballooning subsidy bill.

Indonesia has already tripled its subsidy budget to 502 trillion rupiah ($33.87 billion) to keep prices of some subsidised fuels, power tariffs and liquefied petroleum gas unchanged, but rising demand and high global crude prices could increase the bill further.

The government is currently studying policy options for subsidised fuel prices and a number of lawmakers this week called for imports of cheaper Russian crude oil.

"Regarding this, we are evaluating the risks and its mitigations," said Taufik Adityawarman, chief executive of PT Kilang Pertamina internasional, the refining subsidiary of state energy firm PT Pertamina.

He did not give further details.

Tourism Minister Sandiaga Uno in a video posted on his Instagram account over the weekend said Indonesia has been offered Russian crude at a 30% discount, adding that President Joko Widodo was considering it but there were concerns about sanctions.

Foreign Ministry spokesperson Teuku Faizasyah told reporters on Thursday, that it is a business-to-business matter, but authorities are working to secure energy supply.

"On the government side, in the context of economic diplomacy, we do everything we can to ensure that we can facilitate domestic energy needs through the various diplomatic missions that we carry out," he said.

Pertamina's chief executive earlier this year said with the upgrade of its Balongan refinery, the company would now be able to process Russian crude.

($1 = 14,820.0000 rupiah)

(Reporting by Bernadette Christina Munthe, Fransiska Nangoy; Editing by Kirsten Donovan)