State refinery project undergoes feasibility study

By Nellawati

Construction of a refinery awarded to PT Pertamina is currently undergoing feasibility study. The study is expected to provide a clear picture of production, sites, economic value and technology required.

Director General for Oil and Gas A. Edy Hermantoro said on Tuesday the study would cost the state Rp 17 billion. The government had previously announced a plan to conduct basic engineering design and front engineering design which cost Rp 250 billion this year. But the plan was later changed and would cover only feasibility study.

The remaining state fund will be allocated for conversion of oil fuel into liquid petroleum gas in regions where the government program has not run.

The refinery construction project is expected to finish in 2018. The multi-year project will cost a total of Rp 90 trillion. Edy said the facility would not only produce fuels, but also aromatic products to generate economic margin.

?We no longer take the old direction. We used to build refinery merely to produce fuels. But if only for fuel production our margin will be small,? Edy said.

PT Pertamina has been mandated to build the refinery. It has offered the feasibility study to the public through an auction.

Editing by Benget Besalicto Tnb.