Jakarta. Private fuel retailers Vivo and BP have canceled planned purchases of imported base fuel from Indonesia’s state energy firm Pertamina, citing the discovery of ethanol content in the shipment, a company executive said on Wednesday.

The cancellations underline ongoing tensions in Indonesia’s downstream fuel sector as private players adjust to new regulations centralizing fuel imports under Pertamina’s control.

Vivo, owned by Vitol Asia Pte Ltd, had previously agreed to buy 40,000 barrels, or 40 percent of the 100,000-barrel cargo imported by Pertamina, according to Achmad Muchtasyar, deputy CEO of Pertamina Patra Niaga, the company’s trading and distribution arm.

“Vivo backed out even though they initially agreed to buy 40,000 barrels,” Achmad told lawmakers during a parliamentary hearing in Jakarta.

Lab tests on the imported cargo found ethanol content of around 3.5 percent, Achmad said. He noted that the level remains well below the 20 percent threshold permitted under Energy and Mineral Resources Ministry regulations.

“Despite being within the legal limit, the ethanol content prompted private retailers to cancel purchases of the base fuel,” Achmad explained.

BP also withdrew from its deal with Pertamina for the same reason, he added.

Private retailers have faced supply pressures since the government imposed a single-gateway import system, requiring all imported fuel to go through Pertamina. Companies such as Shell, Vivo, BP, and ExxonMobil have since engaged in talks with Pertamina and Energy Minister Bahlil Lahadalia to negotiate conditions.

The agreement reached requires Pertamina to supply base fuel with no additives or dyes, and quality inspections must be carried out by independent surveyors.

Achmad said he remained optimistic that private retailers would return to the table for the next shipment, expected to arrive later this week.

So far, however, no private retailer has completed a purchase of base fuel from Pertamina.

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