Signing of JV agreement for Banten refinery delayed

The signing of an agreement to set up a joint venture which will build and operate an oil refinery plant in Bojonegara, Banten, initially scheduled to be held Monday (Jan. 22), has been delayed until August, state oil and gas firm Pertamina has said.

Pertamina did not unveil the reason of the delay but the company?s director for processing Rukmi Hadihartini was quoted by Kontan daily as saying that its partners Oil Refining Industries Development Company (ORIDC) of Iran and Petrofield of Malaysia had asked the joint venture agreement to be signed two months after the signing of the memorandum of understanding.

Under the MOU agreement signed in June, Pertamina will have a 40 percent stake in the joint venture while ORIDC and Petrofield will hold a 40 percent and 20 percent stake, respectively.

Rukmi said that the delay would allow Pertamina and its partners to discuss the possible entry of STX Corporation of South Korea into the joint venture, which plans to build an oil refinery plant with a processing capacity of 300,000 barrels per day.

The joint venture will need at least US$4 billion to build the refinery.

Rukmi said that the Korean company had expressed its keen interest to take part in the refinery project but its request could not be fulfilled because the MOU for the joint venture establishment had already been signed.

The delay would allow the existing shareholders to discuss the Korean company?s request to be part of the joint venture, she said. (*)