Stoppage of production at Tri Wahana Universal
Friday, February 19 2016 - 02:40 PM WIB
Refinery owner PT Tri Wahana Universal (TWU), a subsidiary of PT Saratoga Investama Sedaya Tbk, has stopped production as no agreement has been reached between the firm and crude suppliers on the price of crude supply, Saratoga said in a statement on Friday.
Saratoga noted that while the production has been suspended, TWU continues operational activities such as sale, distribution and collection.
??TWU has also been undertaking the annual overhaul and maintenance of its mini refinery,?? the firm said.
The production has been suspended because TWU has discontinued procuring crude oil supply since discussion and negotiation with ??related parties?? on the well mouth selling price formula is still ongoing.
??Once a resolution on the crude oil selling price is agreed, TWU shall resume its production,?? Saratoga said.
According to the firm, the production stoppage by TWU will cause the company to lose its operational income significantly, although as per Sept. 30, 2015, the contribution of TWU to the company's consolidated profit attributable to the shareholders is 18 percent.
As of 31 December 2015, the company holds 35 percent effective ownership on TWU; representing about 3 percent of the company's total investment portfolio.
TWU operates a small scale refinery in Bojonegoro regency of East Java with a processing capacity of 18,000 bpd. The refinery gets crude supply from Mobil Cepu Limited oil field, which is channeled through five kilometers pipe to the Bojonegoro plant.
Editing by Johannes Simbolon