Pertamina to raise US$500 million loan to finance strategic projects

State owned oil and gas company Pertamina will raise loans worth up to US$500 million from a number of foreign banks to finance the company's strategic projects including the development of the Cepu block.

The company's finance director Frederick Siahaan said in Jakarta on Wednesday that the loan would be part of about US$1.3 billion lending facilities offered by a number of foreign banks during the company's road show in Singapore, Hong Kong and London recently.

"We hope the loan could be disbursed before the end of this year," he added.

According to him, the loans would be partly used to finance the company's equity for the development of the Cepu block, which is operated by the company under joint operation with ExxonMobil Indonesia.

Other projects to be financed by the loans include the expansion of processing units at the company's Balongan and Cilacap refinery plants. Under this project, the capacity of the propylene processing unit at the Balongan refinery would be increased by 300,000 tons a year.

Frederick also said that the loans would be also partly used to purchase eight new tankers with a dead weight capacity of between 7,500 tons and 75,000 tons. (godang)