Wahana Universal to build mini oil refineries in Cepu

Government has given an approval to state-owned oil and gas company PT Pertamina and its partner, Mobil Cepu Ltd, a subsidiary of US oil and gas giant Exxon Mobil to build three portable oil refineries in the Cepu Block to cut reliance on fuel imports

?We have approved the building of the portable plants. Principally, the construction is easy because technology has been available," Energy and Mineral Resources Minister Purnomo Yusgiantoro said on Thursday.

"Building the small refineries in Cepu is cheaper than having to build a pipeline to an existing refinery," Purnomo said. These so-called mini-portable refineries can be dismantled and relocated easily, he said.

Each portable refinery will have a capacity of processing 6,000 barrels of oil per day. Production is scheduled to start at the end of 2008, he said.

Meanwhile, Pertamina?s General Manager for Cepu Hestu Bagyo said that the number of refineries which would be built was only two with each having a capacity of 6,000 bpd.

The refineries will be built by private firm PT Wahana Universal with investment value at around US$30 million, he added.

Cepu, which is jointly operated by Pertamina and Exxon with 45 percent interest each, while local governments hold the remaining 10 percent will start early production from in 2009 with initial production of 10,000 BPD. Peak production of 165,000 BPD would be achieved in 2-3 years after first production. (godang)