Pertamina to offset downtime, hike August fuel imports

Indonesia's Pertamina will raise its fuel imports by 60% for a month starting in August to compensate for a drop in production at its Cilacap refinery in Central Java.

Eric Watkins
Senior Correspondent

LOS ANGELES, July 24 -- Indonesia's state-owned PT Pertamina will raise its fuel imports by 60% for a month starting in August to compensate for a drop in production at its Cilacap refinery in Central Java.

"We will overhaul our refinery in Cilacap in August and this will halt its production for about 1 month," said Ahmad Faisal, director of marketing for the state firm.

Faisal said Pertamina will increase its imports to match the normal monthly output from the Cilacap facility, which produces 350,000 b/d. About 60% of its output includes fuel, while the remainder is taken up by asphalt and oil-based lubricants.

The announcement followed reports that Pertamina, already a candidate for government scrutiny over corruption in the upstream sector, is facing charges by legislators of "irregularities" in its importation of crude oil and products (OGJ Online, Jul 22, 2008).

In 2007, Pertamina imported 321,000 b/d of crude oil and 300,000-350,000 b/d of fuel to help meet domestic demand of 1 million b/d of fuel. The country's six refineries reportedly have a combined production capacity of 652,000 b/d.

The Cilacap refinery has two crude distillation units with respective capacities of 118,000 b/d and 230,000 b/d. The facility also has a 29,000 b/d gasoline-making reforming unit and a 50,000 b/d visbreaker.

Last year, Pertamina and Japan's Mitsui & Co. announced plans to establish a joint venture to build a $1 billion gasoline cracker at the Cilacap refinery, and Pertamina processing director Suroso Atmomartoyo said the new unit would have a capacity of 40,000-50,000 b/d (OGJ, Jan. 15, 2007, Newsletter).

In May, Pertamina processing director Rukmi Hadihartini said the state oil and gas firm would soon seek financial support to upgrade the refinery, adding that the company would reach a final investment decision in October for the project.

Pertamina estimates have put the cost at around $1.9 billion, but Hadihartini said recalculations are underway as "the price of raw materials, such as steel, has soared."

Contact Eric Watkins at hippalus@yahoo.com.

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