Investment in fuel refinery needs incentives

By Godang Sitompul

The country?s downstream oil and gas regulator BPHMigas said that investors in the country?s fuel refinery sector needs incentives from the government due to the small margins, while investment requirement is huge.

BPHMigas Fuel Director Djoko Siswanto told Petromindo.com Monday that withou the incentives no investors would be attracted to develop fuel refineries in Indonesia. He said that the margins are so low because of the huge investment requirement, expensive raw material, while the end products are sold at low price.

?We have invited a number of companies in the Middle East to develop fuel refineries (in Indonesia), but until now there has been no progress yet. This is because of the small margins,? Siswanto said.

Editing by Reiner Simanjuntak