Freight cost determination for domestic contract of affreightment PT Pertamina international shipping using activity-based costing (case study: Muara Teweh – refinery unit V Balikpapan)

The price fluctuations of Indonesia’s oil and gas illustrate the effort in maintaining energy security through export and import activities in various conditions, both normal and pandemic eras, even at the new normal as it is today. This condition indicates that maritime logistics will always be required to support all types of industrial activities. PT Pertamina International Shipping (PIS) is shown in the maritime supply chain to fulfill domestic and international energy needs. This research is focused on a case of vessel charter services for PIS’s client in offering shuttle services for cargo transportation on the Muara Teweh - Refinery Unit V Balikpapan route, with Floating Storage and Offloading (FSO) as an optional storage facility. An analysis is carried out by determining freight costs using activity-based costing completed with a transportation schedule simulation to transport the client’s cargo. The results show that to minimize the freight cost, Scenario 1 is the best by allocating 1 Self Propelled Oil Barge (SPOB) with a cost of USD126,062.13 while Scenario 2 produces a freight cost of USD174,223.55 per 12,000 bbls per shipment. The operational time including loading, transportation, and unloading processes with 10 shipments in total consumes 284 days with the implication that the client does not require FSO. Therefore, the operational process of cargo transportation will be optimal when the client can maximize the use of its current storage tanks and vessel route using 1 SPOB.