Government sets deadline for mending refinery
Government sets deadline for mending refinery
JAKARTA (JP): The government has set a six-week deadline for contractors to repair a newly completed export-oriented oil refinery in Balongan of West Java, of which technical troubles have delayed its dedication.
"I have instructed the state oil company Pertamina's contractors responsible for the construction of the country's first export-oriented refinery (Exor 1) to cope with damages at the refinery and to assure its full operation by the middle of March," Minister of Mines and Energy I.B. Sudjana said yesterday.
The refinery, designed to have a processing capacity of 125,000 barrels of crude oil per day, was originally scheduled to be dedicated by President Soeharto on Monday. But damages occurring during its trial operation caused the delay of its dedication.
Sudjana, who met with the President at the Merdeka Palace yesterday to report on the condition of the refinery as well as his recent visits to Arabian countries, told reporters that the damages have forced the refinery to operate only at 60 percent of its capacity.
"The President has also agreed on the delay of the plant's operation and instructed Pertamina and its contractors to prepare as many as operators for the sophisticated project," he said.
Contractors
Pertamina appointed JGC Corporation of Japan, Foster Wheeler of the United States, Mitsui of Japan and Far East Oil Trading Corp., an affiliate of Pertamina, as its contractors for the construction of the refinery. The construction of the refinery started in September 1990.
Pertamina recently said that the US$2 billion refinery was constructed with financial assistance from Java Petroleum Investment Co. Ltd. -- a consortium grouping Mitsui Corp., Marubeni Corp., Sumitomo, C. Itoh & Co. (now Itochu) and 20 Japanese bankers.
Sudjana did not elaborate on the damages. Pertamina recently reported that the trouble was partly caused by bottlenecks at a crude oil processing unit, called Residue Catalytic Cracking machinery, which processes crude oil with a high level of metal and residue contents.
Sudjana refused to estimate the losses caused by the delay of the refinery's full operation, but said: "We've surely missed an opportunity to export oil products due to the delay of its full operation."
The refinery is designed to produce 136,000 tons of liquefied petroleum gas per year and 186,000 tons of propylene a year, 54,500 barrels per day (bpd) of aviation gas, 10,437 bpd of kerosene, 24,500 bpd of automotive diesel oil, 14,890 bpd of industrial diesel oil and 7,200 bpd of decant fuel as well as 27 metric tons of sulfur per day.
Pertamina is now operating five oil refineries with a total processing capacity of about 850,000 bpd.(fhp)