Pertamina Lands RFID Contract with Local Government Agency in Jakarta

The radio frequency identification (RFID) technology was developed to control the fuel sales in Indonesia. The state-owned oil and gas giant Pertamina once expressed an interested in developing a program using this technology. But, since the government removed fuel subsidies in 2015, development of the program was put on hold. Now, Pertamina has found another good use for this technology: to control fuel usage in government institutions.

Pertamina subsidiary, Pertamina Retail, has signed an RFID contract with Jakarta’s sanitation agency, worth IDR 396.8 billion a year. Pertamina Retail’s President Director Toharso said this cooperation follows up the agreement sealed by Jakarta Governor Basuki Tjahaja Purnama and Pertamina’s President Director Dwi Soetjipto in 2015. “So this is the implementation,” Dwi said during the launching of the RFID technology in Sunter, Jakarta, on Monday (4/4).

Under this agreement, fuel for all operational vehicles belonging to the Jakarta sanitation agency can only be purchased using an RFID card at fuel stations operated by Pertamina Retail (COCO fuel stations). This will help to establish a more transparent and efficient method of purchasing of fuel by this government agency. (Read: Pertamina Proposes Fuel Price Cut of IDR 200-400 per Litre)

Toharso explained that the RFID technology offered several benefits. First, if an RFID card is lost, the person finding it would not be able to use it, because the card has the registered vehicle number on it. Second, there is a daily limit on fuel use. 

Third, this card enables much firmer control because the place and time of every transaction is recorded. “So, if there is an official audit, we can just print it [the record] out,” Toharso said.

Currently, this use of RFID technology is limited to inter-agency agreements. Pertamina has sealed a cooperation agreement with Balikpapan district government worth IDR 17.7 billion, and with the Bekasi district government (IDR 12.1 billion). Pertamina also has a contract with Transportasi Jakarta worth IDR 19.1 billion, and one with Bandung district government worth IDR 2.8 billion. Going forward, Toharso hopes to expand the use of RFID technology to personal vehicles.

However, Pertamina’s Vice President for Fuel Marketing and Distribution Muhammad Iskandar said the use of RFID technology had already expanded. In the past, only embassies used this technology, but now government agencies are using it too. According to Pertamina Retail data, 1,500 corporations and local governments are using this technology. Pertamina Retail has issued 35,000 RFID cards, and the most recent batch of 6,000 cards is for the Jakarta administration.

Meanwhile, the head of Jakarta’s sanitation agency Isnawa Adji said the total value of the contract (IDR 396.8 billion) is reasonable, because his agency operates around 1,500 trucks collecting rubbish from all over Jakarta. So, the high cost of this new technology is outweighed by its benefits. (Read: Pertamina’s CEO Rejects Government’s Proposed Excise Duty on Fuel)

Isnawa explained that using the RFID card would do away with any fraudulent fuel transactions. To support the use of this technology, the agency has built a control room to increase the agency’s transparency and accountability. Eventually, the implementation of the RFID technology will also be monitored from the control room. “The RFID technology allows us and Pertamina Retail to continuously monitor fuel purchases,” Isnawa said.