Pertamina Signs Pacts to Boost Refining Capacity

JAKARTA, Indonesia--PT Pertamina has signed an agreements with three foreign partners to spend $25 billion over the next four years to double capacities at three refineries.

The three partners--Saudi Aramco, Japan's JX Holdings, and China's Sinopec Pte Ltd --will help the Indonesian state-owned oil and gas company boost the total capacity of the Cilacap, Balongan and Balik Papan refineries to 1.68 million barrels per day, said Pertamina's Chief Executive Dwi Soetjipto.

Pertamina's total refining capacity is currently around 1.05 million barrels/day, but the daily utilization is around 700,000 barrels as some refineries are old.

Indonesia needs to import fuel to meet the shortfall in its daily domestic consumption, which ranges between 1 million and 1.5 million barrels.

The government has been also mulling plans to build a new refinery to help reduce petroleum fuel imports as domestic consumption is expected to continue rising, driven by healthy economic growth.

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