Saudi Aramco is to revitalize Cilacap Refinery by the end of 2016

KATADATA - Saudi Aramco will start to revitalize Cilacap Refinery by the end of next year. Right now, the Arabian company is still preparing to conduct the refinery development program (RDMP) of that particular Pertamina’s refinery. 

Pertamina’s president director Dwi Soetjipto said that Saudi Aramco still needs more time to plan the Front End Engineering Design (FEED) to revitalize the refinery. “It may take three to four months, just for Cilacap,” Dwi said in Jakarta, Thursday (12/11).

Revitalization of refineries is needed in order to maximize the domestic production of oil and fuel, which is crucial to reduce the high amount of imported oil and fuel that Indonesia does. The reduction in import could also save great amount of revenue for the state. 

And so, the actual and broader plan is that Pertamina will revitalize four refineries, which are Cilacap, Balikpapan, Dumai, and Balongan. But for the first phase of development, the focus will be on Cilacap and Balikpapan. Dumai and Balongan refineries will begin to be reconstructed after the first two refineries in Cilacap and Balikpapan are done.

Cilacap revitalization will be conducted by Saudi Aramco, while Balikpapan Refinery will be revitalized by Japan-based firm, which is JX Nippon.

The Head of Agreement (HoA) discussion to revitalize the two refineries has been signed. The next phase is to design the plan in detail. And after the project is done in 2020, the capacity of the two refineries will increase by 110,000 barrels of oil per day (bpd). Cilacap Refinery’s capacity will increase from 300,000 bpd to become 370,000 bpd, while Balikpapan Refinery’s capacity will increase from 260,000 bpd to become 300,000 bpd. 

And so, the revitalization of the four refineries will make Pertamina’s oil refineries to double their daily production capacity, which is from 850,000 bpd to become 1.5 million bpd in the next five years. The total investment needed to make the revitalization happen reaches US$ 25 billion. 

Other than revitalizing the refineries, Pertamina is also preparing the new grass root refinery (GRR), or new refineries development, which will start next year. Dwi is hoping so that there will soon be suitable partner(s) for Pertamina to build the new refineries.