Pertamina formally enters petrochemical business

State oil ands gas firm Pertamina had formally entered petrochemical business on Friday after signing master participant agreement and purchase sales agreement on East Java petrochemical venture.

According to Pertamina?s spokesperson Ridwan Nyak Baik, under the agreements, the company would supply between 15,000 to 20,000 barrels per day of low sulphur waxy residue (LSWR) to PT Trans Pacific Petrochemical Indotama (TPPI) and in return, Pertamina would get 15 percent participating interest in TPPI.

Earlier, pertamina president Baihaki Hakim said the petrochemical complex would resume construction early next year and the completion is expected in 2003.

The $2.3 billion project was initially controlled by the Tirtamas Group (70 percent) Siam Cement of Thailand (20 percent), Nissho Iwai Corp, and Itochu Corp (each having 5 percent). Because of its huge bad debt burden, the project is now controlled by the Indonesian Bank Restructuring Agency (IBRA).

Pertamina?s entrance has changed the composition of the TPPI share structure, with Newco, which is controlled by IBRA owning 59.5 percent, Tuban Petrochemical Pte Ltd 17 percent, Pertamina 15 percent, Itochu Corporation 4.25 percent and Nissho Iwai Corporation 4.25 percent. (godang)