Pertamina plans $5.31b capital expenditure next year

State owned oil and gas firm PT Pertamina (Persero) plans to spend US$5.31 billion next year, up 20.7 percent from this year, to boost all lines of business.

Of the funds, 72 percent is allocated for the upstream sector, 6.9 percent for gas business, 6.7 percent for refinery business, 9.7 percent for marketing and trade and 4.7 percent for downstream sectors and other subsidiaries, President Director Dwi Soetjipto said in a statement on Monday, quoting the firm?s plan and budget that has been approved by shareholders.

The firm has consolidated assets worth $50.83 billion, according to the plan and budget

Revenue target for next year is set at $42.26 billion, more or less equal to revenue prognosis for this year. Despite the oil price slump, the firm is optimistic to book 12.8 percent of EBITDA, higher than this year?s prognosis of 11 percent. Net revenue target is set at $1.16 billion.

Dwi projected oil business will remain under pressure next year as oil price is projected to stay weak and the rupiah to stay depreciated against the US dollar. Amid the situation, Pertamina will strive to do its best next year by among others implementing efficiency program.

Upstream sector is expected to contribute 30 percent to total operating revenue. Production is projected to increase to 327,000 barrels of oil per day (bopd) and 1,926 mmscfd of gas or 659,000 barrels of oil equivalent per day (boepd), up 10 percent from this year?s prognosis. Geothermal production is projected to reach 3,245 GWh, up 8 percent from this year?s prognosis.

Downstream sector will be the new prime contributor to revenue, thanks to production from RFCC Cilacap refinery and TPPI refinery and petrochemical plant and sales of non-subsidized gasoline, including Pertalite which was launched in July 2014. Aviation fuel and lubrication businesses are also expected to generate additional revenue thanks their strengthened position in the domestic market and expansion in international market.

Gas business is also expected to increase exponentially thanks to among others completion next year of gas pipelines projects such as Semarang-Gresik, Porong-Grati, Belawan-KIM-KEK pipeline projects, Dwi said.

Editing by Johannes Simbolon