Partamina set to allocate $100m to revamp Cilacap refinery

State oil and gas firm PT Pertamina is set to allocate about US$100 million to finance the Cilacap refinery modification project in Central Java in a bid to increase the refinery’s capacity to 410,000 barrels per day from 348,000 barrels per day at present.

 

Pertamina’s president director Ari Soemarno said in Jakarta Friday that the project would cost around US$1.8 billion. Some $500 million will be provided by Pertamina and its Japanese partner Mitsui Corp while the remaining $1.3 billion will be raised as loans from banks.

 

Pertamina would have to provide between US$100 million and $150 million and the rest is expected to come from Mitsui.

“But Pertamina has yet to decide on the portion of its stake in the project,” he said.

 

To ensure that the refinery modification project runs well, Pertamina would team up with reputed contractors, such as Chiyoda, JCC and Bechtel, he said.

 

Front and design engineering is expected to be completed in the next several months so that construction could start in 2008. “Production is expected to commence in 2010,” he said.

 

According to Ari, Cilacap refinery’s cracking unit will be subject to modification and when completed , the refinery will be able to produce olefin and liquefied petroleum gas (LPG). Under the plan, Pertamina would modify all of its existing refineries. Feasibility study is now underway. Ari said that all of its refineries are expected to be modified in 2010 or 2011. (Godang)