Chandra Asri wants light naphtha supply from Pertamina

PT Chandra Asri Petrochemical Center has expressed interest to buy light naphtha from state-owned oil and gas company Pertamina but the petrochemical giant wants a guarantee a continuous supply before making any agreement.

Bisnis Indonesia reported on Saturday that the two executives of the companies met in Jakarta on Thursday to discuss the request. According to the newspaper sources Chandra was ready to cut the contract with other suppliers as long as Pertamina could guarantee a continuous supply.

Pertamina?s director for downstream operation, Muchsin Bahar, confirmed that the petrochemical giant had requested to buy light naphtha from the state owned oil and gas company. "But the request should be first discussed by commissioners before making any deal," he said.

"So far our light naphtha production has been allocated to support the Blue Sky program," he said in a reference to the company?s program to encourage the use of pollution-free fuel. "That?s why we could not give a 100 percent guarantee to supply Chandra," he added.

Pertamina might procure naphtha from the spot market but getting the naphtha supply from the market is not certain both in term of prices but also in the availability of the supply. Muchsin said that Chandra can also procure crude from the Cepu oil field and process it into light naphtha. "If they agree, then Pertamina does not need to make new investments," he added.

At present Chandra Asri imports its light naphtha supply from the Middle East with annual imports worth about US$200 million. (*)