Petromindo.com, Thursday, May 28, 2009

A bankable feasiblity study for and the engineering design of a refinery project in Bojonegara, Banten have been completed, a senior official of state oil and gas firm PT Pertamina said on Wednesday.

"The final bankable feasibility study and engineering design have been done. The study was carried out by Axens Consultant," Rukmi Hadihartini, Pertamina’s Processing Director, said on Wednesday.

"We wish we could sign a joint venture establishment act these days. However, since there are some administrative problems that the Indonesian ambassador in Iran has to handle, the signing has been postponed until June 22," he said.

Previous reports say Pertamina plans to build the 300,000-bpd refinery in partnership with Oil Refining Industries Development Company (ORIDC) of Iran and Petrofield Malaysia. Pertamina is expected to own 40% of the consortium, ORIDC 40% and Petrofield Malaysia 20%. The crude supplies are expected to come from Iran.

Latest reports however say the Banten provincial admnistration is also interested to take a stake in the project.

Rudi Radjab, President Director of the provincial administration-owned Banten Global Development, confirmed that the firm was a partner of Pertamina in the project, but he refused to specify the number of its shares.

He also said the consortium is likely to invite South Korean firm STX Corporation to join if it is unable to raise funds for the project.

The project is expected to cost US$4.7 billion, between 60 and 70 percent of which is expected to be covered with loans. The rest will be covered with equity by the consortium mambers.

"Indonesia and Iran are ready to reduce their ownership if the project needs more funds," he said (Godang/Bernard)