Foreign firms allowed to partner with local private firms in refinery projects

Foreign private investors will be allowed to develop domestic oil refinery as long as they team up with local private companies, according to a senior government official

Director General of Oil and Gas at the Ministry of Energy and Mineral Resources IGN Wiratmaja Puja said in a statement on Friday that according to new Ministerial Regulation No 35/2016, signed by Minister of Energy and Mineral Resources Ignasius Jonan on November 10, foreign companies are allowed to team up with domestic companies in refinery projects.

Wiratmaja said that the regulation on investment in domestic refinery projects is now clear following the issuance of the new ministerial regulation on the development of domestic refinery by private entities.

?We made the ministerial regulation to make it clear. For instance, can the crude be imported? The (new) regulation says yes it can be imported. Can they (the investors) sell the (fuel) output? The (new regulation) says yes they can. Can they enter the retail (market)? Yes they can,? he explained.

He said that the new ministerial regulation provides greater freedom for investors in developing domestic refineries including on the size of the capacity.

Meanwhile, Vice Minister of Energy and Mineral Resources Arcandra Tahar said that domestic refinery projects planned by the private entities will be aligned with those planned by state-owned oil and gas firm PT Pertamina.

Editing by Reiner Simanjuntak