Pertamina Sign MoU With Three Strategic Partner To Upgrade Refineries in Indonesia

abarrelfullabarrelfull wrote on 31 Dec 2014 10:08

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PT Pertamina (Persero) today signed a Memorandum of Understanding with three leading global oil and gas companies cooperate in capacity expansions and upgrades at five refineries in Indonesia through a Refining Development Master Plan (RDMP).

Expansion and upgrading refineries are expected to require significant investment, which is about $ 25 billion over the next ten years. Refinery upgrade plan is part of an initiative by Pertamina to ensure long-term energy security for Indonesia. RDMP is a step to ensure that Indonesia has enough processing capacity to meet the demand for fuel and petrochemical products in the country as it continues to grow. Strategic Partners will also gain access to the fast growing Indonesian market.

These projects are expected to double the production capacity of the refineries whilst help preserve the environment through the production of fuel meeting Euro IV - specifications for sulfur content and emission standards. This can be realized through an increase in the complexity of the refinery to increase the yield of the main fuel production, and the doubling of the capacity of crude oil processing unit (CDU) of 820,000 barrels per day (bpd) to 1.680 million bpd. In particular, the gasoline production will be increased by 3.3-fold from 190,000 bpd to 630 bpd, diesel production will increase by 2.4 times from 320,000 bpd to 770,000 bpd, and the production of aviation fuel will increase from 50,000 bpd to 120,000 bpd in the final phase of the project is expected to be completed in 2025. The chemical products produced at the refineries will also increase significantly, this includes products such as polyethylene, propylene, polypropylene, and paraxylene.

The signing of the MOU is done by Pertamina Refinery Director Rahmat Hardadi and representatives of the three strategic partners, namely Ibrahim Al Buainain, President Aramco Asia, Michio Ikeda, Executive Vice President of JX Nippon Oil & Energy Corporation, and Liao Xudong, General Manager of Sinopec (Southeast Asia) Pte.Ltd. The signing ceremony was witnessed by the Director of Pertamina Soetjipto.

MoU RDMP strategic partnership is the culmination of the process of finding a partner that lasts long enough, ie for one year. Pertamina has roadshow in search of prospective strategic partners and has received a visit from the prospective partners to refineries Pertamina. Approximately 400 companies were considered during the selection process before choosing a partner Pertamina is based on financial criteria, operational and strategic evaluation.

After the partner selection process, Pertamina will work with Saudi Aramco to develop and evaluate investment options for Dumai and Cilacap refinery and Balongan refinery. China Petroleum & Chemical Corporation elected to refineries Plaju, JX Nippon Oil & Energy Corporation to Balikpapan refinery.

After signing the MoU, Pertamina and strategic partners plans to form a joint team to evaluate the feasibility of the project, and develop a marketing plan and financial, are required to support the investment. Pertamina and the partners are targeting completion of the FEED (Front End Engineering Design) for the refinery project in the period 2015-2016 .

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