Pertamina to meet TPPI project?s Japanese lenders

The state-owned oil and gas company Pertamina will meet the Japanese lenders to discuss the problems including issuance of the government?s guarantee letter related to the Trans Pacific Petrochemical Indotama (TPPI) project in Tuban, East Java, Kompas newspaper reported on Tuesday.

The meeting will be held this week in Japan, Pertamina?s president director Ariffi Nawawi told reporters in Jakarta on Monday.

Indonesian government?s representative in Japan and TPPI official will attend the meeting, Ariffi said.

Ariffi also explained that the guarantee letter, which was requested by the Japanese lenders, was not related financial guarantee. However, the guarantee would be an assurance that the government support the participation of Pertamina in the project.

Earlier, Pertamina said it would go ahead with the plans to finish the TPPI project also known as Tuban project, pending the issue of government?s guarantee.

The government is yet to issue a guarantee letter for the project. The creditors of the project want a guarantee for their investment from the government.

The Japanese creditors ? Sumitomo Bank Mitsui Corporation (SBMC) and Japan Bank for International Cooperation (JBIC) ? formed a consortium and signed an agreement on June 24, 2003 in Japan to provide funds for the project.

The US$400 million project is almost finished. Presently, it has entered into the phase of finishing the building of petrochemical storage tank, which will store the products including middle distillate (crude diesel and kerosene) and light naphta (premium gasoline). The plant will begin its operations in 2004. (*)