PRODUCTION PARTNERS OF PETROGANIK SUBSIDIZED FERTILIZER GET CAPITAL CERTAINTY

PRESS CONFERENCE

BUMN Synergy

PRODUCTION PARTNERS OF PETROGANIK SUBSIDIZED FERTILIZER

GET CAPITAL CERTAINTY

Event : Signing of Financing Cooperation Agreement

Place : Surabaya

Day / Date : Friday, November 30, 2018

As one of the Petroganik subsidized organic fertilizer producers, PT Petrokimia Gresik (PG), a subsidiary of PT Pupuk Indonesia (Persero), currently holding 167 Petroganik production partners spread throughout Indonesia. In its journey, this production partner experienced obstacles in terms of capital in financing the production process.

Marketing Director of PG, Meinu Sadariyo, stated that PG as a fertilizer and chemicals producer for agro-industry solutions seeks to provide solutions to these problems. In this case, PG collaborates and synergizes with Bank Mandiri as one that shall provide capital loans of 200 billion rupiahs for Petroganik production partners (supply chain financing).

"Petroganik production partners will get loan from Bank Mandiri with lower credit interest rates compared to direct application. The conditions are also easier, faster process, and does not require collateral, since Petrokimia Gresik has already become guarantor or avalist for Petroganik production partners", Meinu explained after signing partnership agreement in Surabaya, Friday (30/11).

With this capital certainty from banks, PG will also get certainty and sustainability of Petroganik fertilizer supply from its production partners. Whereas Bank Mandiri gets benefit from network expansion and loan lending to its customers.

"This collaboration is also a form of coaching, due to our partners are small and medium enterprises that need support. Because of our partner business in the area are able to provide a multiplier effect in the form of absorption of organic raw materials from farmers and local cattler, absorb labors, and support surrounding small business units", Meinu said.

Meinu further stated that based on the Regulation of the Minister of Agriculture (Permentan) No. 47 Year 2017 concerning the Needs and Highest Retail Prices (HET) of Subsidized Fertilizers for the Agriculture Sector in 2018, it was stated that the holding of PT Pupuk Indonesia (Persero) received the allocation of procurement and distribution of subsidized fertilizers of 9.55 million tons. From this amount, 1 million tons of which are Petroganik fertilizers.

"From one million tons allocation of Petroganik fertilizer, Pupuk Indonesia appointed Petrokimia Gresik to produce and distribute around 942,200 tons or almost all regions in Indonesia. Except West Java and Banten which are currently the responsibility of PT Pupuk Kujang Cikampek", Meinu said.

Petroganik Fertilizer is a product of PG research that is born based on the fact that the conditions of agricultural land in Indonesia has an organic content below 2%. While the healthy land is at least 5% organic matter. PG started Petroganik fertilizer research since 2004. While the partnership cooperation model started since 2006. Since then, PG has started to test the quality and effectiveness by cooperating with several agencies as well as socializing it to farmers through various demonstration plots (demplot).

Two years later (2008), and to date, Petroganik fertilizer has been trusted by the government and become one of the fertilizers included in the fertilizer subsidy scheme along with Urea, ZA, SP-36, and NPK Phonska. Government trust was obtained through the ability of Petroganik fertilizer to restore soil health. With a minimum organic content of 15%, Petroganic fertilizer is capable to improve the physical, chemical and biological properties of the soil. If the land is healthy, it will help the efficiency of inorganic fertilizers usability and support the long term sustainable agriculture. Petroganic fertilizer innovation is one concrete manifestation that PG is not just being producers of fertilizers and chemicals only, but research-based companies that provide a solution for the agricultural sector and industry in Indonesia.

PT Petrokimia Gresik

Yusuf Wibisono

Corporate

Secretary

For further information, kindly contact:

Corporate Secretary : Yusuf Wibisono

Office : (031) 3981811

Ext. 2218

Mobile : 0811 378 571

Email : wibisono@petrokimia-gresik.com

yusufwibie@gmail.com