Pertamina signs oil processing deal with Sietco
Monday, October 2 2000 - 08:00 AM WIB
State oil and gas company Pertamina signs on Monday a deal with Shell International Eastern Trading Company (Sietco) allowing the latter to process the crude oil owned by the former.
The deal was signed by Pertamina's president Baihaki Hakim and Sietco's president Glyn Hallyday during a ceremony closed to the press, according to a source at Pertamina.
The deal was effective for three months from October 1 to December 31 this year, the source said.
Under the deal, Sietco will process 50,000 barrels per day (bpd) of the Arabic Light Crude owned by Pertamina at its refinery in Singapore.
The processing of the crude will produce mogas with octane number 97 (16 percent), kerosene (20 percent), automotive diesel oil (18 percent), and fuel oil (43.5 percent) for Pertamina with the remaining 2.5 percent categorized as "refinery fuel lost", the source said.
The source refused to reveal the fee to be paid by Pertamina to Sietco.
Baihaki said on Saturday that the deal was aimed at meeting the domestic demand that could not be supplied by Pertamina's refinery.
The output of Pertamina's refinery was only adequate for 80 percent of the domestic demand, he said.
Baihaki said Pertamina is currently negotiating with Malaysian state oil and gas company Petronas and Exxon Mobil's office in Singapore on similar deals. Pertamina expects Petronas to process 20,000 bpd of oil and Exxon Mobil to process 50,000 bpd of oil.
"If the cooperation with three companies are realized, it will look as if we had had another refinery," Baihaki said.
Former Minister of Mines and Energy Susilo Bambang Yudhoyono instructed Pertamina to cooperate with other refineries to process its oil last month when the country was hit by a fuel crisis following an operational problem at the company's refinery in Balongan, West Java. (Lia KS)