Indonesia's Pertamina plans investment increase to double refinery capacity
JAKARTA, (Reuters) - Indonesian state energy company PT Pertamina is planning capital expenditures of $4.2 billion this year and will raise it to $7 billion in two years as part of plans to double its oil refinery capacity, chief executive
Pertamina is under pressure from the government to expand its downstream production to reduce imports of refined oil products, which creates a trade deficit that weighs on the Indonesian rupiah.
“Starting from 2021, we will invest around $7 billion per year as these refineries (developments) are in progress,” Widyawati said in a meeting with journalists late on Thursday.
Pertamina plans to double its refining capacity to 2 million barrels per day (
Pertamina expects to import 351,000
The company is currently working on at least seven refinery projects, including the new Bontang and Tuban refineries and the upgrading of the Balikpapan and Cilacap plants.
To finance the investment, Finance Director Pahala Mansury said Pertamina has the capacity to raise funds through borrowing, but the company is actively looking for partners for certain projects.
“We are looking for investment partners. These are big investments and the return may take a while,” Widyawati said.
Meanwhile, Pertamina is targeting $58.85 billion in revenue in 2019, up from $56.06 billion in 2018. (Reporting by Wilda Asmarini; writing by Fransiska Nangoy; editing by Christian Schmollinger)
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