New oil refinery to be built in Jepara regency

Two local companies PT Nusa Ina Pinunjul and PT Lima Karya Mandiri Sejahtera plan to jointly build a new oil refinery with a capacity of 150,000 barrels per day in Mlonggo village, Jepara, Central Java, Bisnis Indonesia reported on Wednesday.

Hendro Martoyo, the regent of Jepara, said in Semarang on Tuesday that the local government had in principle agreed with the two companies' plan, although details of the investment plan had yet to be discussed.

Hendro said that the new oil refinery which would cost about US$2.5 billion to build was expected to be able to employ about 3,000 workers. "Hopefully, the refinery project can be commenced next year," he added.

According to him, the fuel products to be produced from the new oil refinery would be supplied to northern parts of Java including Jepara, Karimunjawa isles and Semarang.

Meanwhile Pertamina said that the company needed a larger refinery plant to meet the planned increase in oil production in its old oil wells in Kaweangan and Ledok-Nglobo in Cepu.

Richard H. Tamba, Genera Manager of Pertamina's operations in East Java, said that the production in the two old oil wells would be increased to 3,500 barrels per day from 3,200 bpd at present.

But the plan to increase the production had been hampered by the lack of processing facilities, he said, adding that Pertamina's existing refinery plant in Cepu is able only to process 2,500 bpd.

"We should therefore send the other 1000 bpd of the oil production to PetroChina's oil refinery plant in Bojonegoro," he added. (*)