Indonesia’s state-owned oil firm PT Pertamina and Saudi Aramco aim to finalise a deal in the first quarter of 2020 as they discuss a new plan for their joint venture, according to a Reuters report.
A plan to upgrade the Cilacap refinery in Central Java has been under discussion since 2016 but the two firms have failed to agree over pricing the project.
Their latest approach could see them form a joint venture company focused only on a planned additional facility at the site, CEO of PT Pertamina Nicke Widyawati has been quoted as having said, instead of an initial plan that called for a jv that involves all of the Cilacap facilities.
Pertamina would continue to operate the existing refinery and pay processing fees to the jv under the new plan under discussion, she said.
The expansion aims to increase Cilacap’s refining capacity to 400,000 barrels per day from 348,000.
A Pertamina official in April said that if a deal with Aramco is not reached, the state-run company is prepared to launch the project on its own to meet its 2025 operational target.
Pertamina is also considering finding a new partner for its US$10 billion refinery project in Bontang, East Kalimantan.
Pertamina had signed a framework agreement in 2018 with Oman’s Overseas Oil and Gas LLC (OOG) to develop a refinery and petrochemical complex in Bontang.