Govt to issue regulation on refinery development

By Godang Sitompul & Bernard Loebs

The government will issue a presidential regulation in order to speed up the development of new refineries in the country.

Under the presidential regulation, the government will offer four options for the development of refineries: First, the development by private companies; Second, the development by private companies in cooperation with the government; Third, the development by state owned oil and gas firm PT Pertamina (Persero) on assignment from the government; the development by the government using state budget, Director General of Oil and Gas IGN Wiratmaja said during a press gathering on Monday.

Wiratmaja said the government targets four new refineries, each with a capacity of 300,000 barrels per day, to be developed within 10 years. The projects are expected to cost US$12 billion and petrochemical plant will be built in each of the refinery?s location.

The development of new refineries is expected to create more job for local resources and increase their competence in new refinery technologies.

Wiratmaja said of the four options, the fourth, that is the development by the government using the state budget, is the last option.

Indonesia?s existing refineries were mostly built in the 1970s, except for the Balongan refinery in West Java, which was built in 1994.

Editing by Johannes Simbolon