Pertamina to team up with Kuwaiti firm to build refinery

By Puspita Maylana Devi

State owned PT Pertamina has signed a preliminary agreement with Kuwaiti firm Kuwait Petroleum International (KPI) to build a refinery in Indonesia. South Korean firm SK energy is expected to get involved in the project.

The agreement was signed on July 18 in Jakarta but the information was only released by Pertamina on Friday on its website.

Pertamina said the agreement was signed by Pertamina?s Director M. Afdal Bahaudin, KPI President Bakheet Al Rashidi and during a Joint Steering Committee. Present during the ceremony Assad Alsaad, CEO of Petrochemical Industries Company and Sin Inchul, VP for Global Business Development of SK Energy.

Pertamina did not provide details about the project but it said the KPI delegation came to Jakarta to follow up a visit by an Indonesian delegation to Kuwait two years ago, during which Indonesia asked Kuwait to invest to build a refinery in Indonesia.

?Both parties agreed that the refinery project was very important for Indonesia,? Afdal said.

It depends on the Indonesian government whether the project will be realized. ?We shall talk to the government. We also hope KPI to use its diplomatic access to talk to the Indonesian government,? he said.

The planned refinery would need a guarantee of crude supply for 25 to 30 years. Bakheed said KPI will guarantee supplies of between 200,000 and 300,000 barrels of crude oil per day. The supplies will start in 2019 the time the refinery project is expected to be completed.

Pertamina wanted SK Energy to get involved in the project. ?SK has knowledge and technology. Kuwait does not mind it being involved,? Afdal said.

Editing by Johannes Simbolon