PT Pertamina and Saudi Aramco upgrade Indonesian refinery

Indonesia’s state-owned PT Pertamina and Saudi Aramco, the state-owned oil company of Saudi Arabia, have signed a Heads of Agreement (HoA) to formalize key business principles for joint ownership, operation and upgrade of the Cilacap Refinery located in Central Java, Indonesia as part of Pertamina’s Refinery Development Master Plan (RDMP).

The proposed Cilacap Refinery upgrade will enable the refinery to process more sour crudes, meet high quality product specifications (Euro IV) and produce basic petrochemicals and lubricant base oils. The capacity expansion to 370 MBD will help Indonesia meet its increasing demand of refined products, lubricant base oils and petrochemicals. The agreement includes a long-term supply agreement for Arabian crudes to Cilacap refinery.

This HoA will pave the way for the next phase of development within the scope of collaboration between the two parties. The Basic Engineering Design Study for the Cilacap refinery upgrade is expected to commence soon and be completed by 2016.

RDMP is part of Pertamina’s mission as a national energy company to produce and market fuel products for Indonesia. RDMP will increase the competitiveness of Indonesia’s refineries while increasing domestic supply security.

“Indonesia is a rising powerhouse in the global economy, and has long deep rooted trade and cultural ties with Saudi Arabia. It’s refining sector has enormous potential, and with Indonesia’s fast-growing demand for refined products, Saudi Aramco’s role in Cilacap can help fuel this country’s coming era of development and prosperity,” said Amin Nasser, President and Chief Executive Officer of Saudi Aramco at the signing ceremony.