Private firms to build large refineries<\/p>\n
JAKARTA (JP): Two private companies are set to develop large
\noil refineries in Probolinggo and Situbondo, East Java, state-
\nowned oil and gas company Pertamina's president Faisal Abda'oe
\nsaid yesterday.<\/p>\n
Abda'oe said one of the companies was PT Buana Ganda Perkasa,
\nowned by Probosutedjo, which planned to develop a refinery plant
\nin Probolinggo with US$3.5 billion investment.<\/p>\n
The other company is PT Asia Pacific Petroleum of Hong Kong
\nwhich plans to build a refinery plant in Situbondo with $1.54
\nbillion investment.<\/p>\n
According to Pertamina, Buana Ganda Perkasa received approval
\nfrom the Investment Coordinating Board in July 1994, while Asia
\nPacific Petroleum was approved in July 1995.<\/p>\n
"The two companies have reported to Pertamina their plan to
\ndevelop the projects," Abda'oe said during a ceremony to sign a
\ngas supply agreement with private electricity firm East Java
\nPower.<\/p>\n
The government recently issued Presidential Decree No. 31 of
\n1997 to allow private companies to set up oil and gas refineries
\nthemselves or in a joint venture with Pertamina.<\/p>\n
Pertamina will remain the sole distributor of private fuel in
\nthe domestic market, but private refineries can export fuel which
\nis not needed by Pertamina, according to the new regulation.<\/p>\n
Although the decree states that Pertamina will buy the fuel at
\ninternational market prices, a Pertamina director Samto Utomo
\nrecently said the price could be negotiated to a level to
\nencourage investment.<\/p>\n
Abda'oe said yesterday Pertamina had not yet started
\nnegotiations with the two companies over the price but promised
\nto do so after the government issued the subsequent rulings
\nexplaining Presidential Decree No. 31\/1997.<\/p>\n
Pertamina data says the company now operates eight refineries
\nwith a combined capacity of 989,500 barrels a day.<\/p>\n
Domestic fuel consumption grew 6 percent to 50.19 million
\nkiloliters in 1996\/1997, 22.5 percent or 11.34 million kiloliters
\nof which were imported.<\/p>\n
Abda'oe earlier said Indonesia needed additional refineries
\nwith a combined capacity of 350,000 barrels per day by the year
\n2000. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/private-firms-to-build-large-refineries-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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