S. Korea?s STX drops plan to take part in Banten refinery project

State owned oil, gas firm PT Pertamina decided to invite another partner to realize its plan to build a 300,000 bpd refinery in Banten following South Korean firm STX Corporation?s move to drop its plan of participation in the project.

Pertamina?s Director of Finance Ferederick S.T. Siahaan said that the new partner should ensure the availability of funds for the Banten Bay refinery project.

He said the South Korean firm decided to withdraw from the project because its potential partners in the project could not meet its demand that the refinery's products be shipped to South Korea in return for funds for the project.

Before the South Korean firm came to approach Pertamina, the state owned firm had signed an agreement to establish a joint venture to develop the refinery. Pertamina will have a 40 percent stake in the consortium while National Iranian Oil Products Refining & Distribution Company (NIORDC) and Malaysia?s Petrofield Refining Company will have 40 percent and 20 percent shares, respectively.

The JV will develop a refinery in two stages with combined capacity of 300,000 barrels per day. Earlier reports said the project would cost around US$5 billion with completion seen in 2015.(*)