Pertamina to build lube oil plants

JAKARTA (JP): State-owned oil company Pertamina will build four lube oil blending plants in cooperation with Mobil Oil of the United States, Shell of the Netherlands, Caltex of the United States, China Petroleum Company and domestic firms.

"But we are still negotiating with the foreign and private domestic companies about the lube projects," Minister of Mines and Energy I.B. Sudjana said at a hearing here yesterday with the House of Representatives' Commission on Industry and Mines.

He added that the planned lube oil blending plants will be built in Jakarta under a joint venture arrangement with Mobil Oil, in Surabaya with Shell, in Medan with Caltex and in Ujungpandang with China Petroleum.

All of the joint ventures, he said, will involve private national companies as shareholders.

Sudjana, however, did not elaborate on the technical details of the projects such as designed capacities and investment plans.

Answering a question about the legal foundation of the joint ventures, Sudjana said that the role of private companies in establishing the lube oil plants is allowed by the President's Decision No. 18/1988.

"In order to fulfill the country's needs for lube oil, the mines and energy minister may license private companies to reprocess used lube oil to produce lube oil," he quoted the decree as stipulating.

He said that Pertamina will provide the lube base for the companies which recondition used lube oil as it has done with PT Wiraswasta Gemilang Indonesia, a private company licensed to recycle used lube oil in Bekasi, West Java. (04)