Petromindo.com, Friday, May 29, 2009

State oil, gas company PT. Pertamina will start expansion project at its Balongan refinery in Indramayu, West Java in 2010, a senior official of the firm said on Friday.

Processing Director Rukmi Hadihartini said the project will add another production unit with a crude processing capacity of 200,000 barrels per day (bpd) to the refinery which is the main supplier of fuel to Jakarta and surrounding areas.

The new production facility is expected to start operation in 2014 with crude sourced from Kuwait, she said.

She did not provide details about the project but last December, Pertamina announced it had signed agreements with three international banks namely BNP Paribas, Sumitomo Mitsubishi Banking Corp. and HSBC on US$225 million loans for the development of a polypropylene production plant at Balongan.

The refinery now has a crude processing capacity of 125,000 bpd and produces various fuels such as Pertamax Plus, Pertamina Dex, unleaded gasoline and LPG.

In March this year, Secretary General of the Indonesian Association for Plastics and Olefin Industry (Inaplas) Budi Soesanto Sadiman said that the feasibility study on the project was completed in December 2008 and the polypropylene plant was expected to start operation in 2011.

According to Budi, Pertamina is likely to team up with PT Polytama Propindo, which currently buys all Pertamina’s polyethylene and polypropylene products.

“The other option is that the project is to be wholly owned by either Pertamina or Polytama. Negotiation on this is in progress,” he said.

According to him, the plant will be constructed by Japan’s Toyo Engineering and PT Rekayasa Industri. (godang)