Pertamina, Rosneft Officially Set Up JV Firm for Tuban Refinery

Pertamina and Rosneft officially set up a joint venture firm (Photo : Special)

JAKARTA (TheInsiderStories) – State-owned diversified energy company PT Pertamina through its subsidiary PT Kilang Pertamina Internasional and Russia’s Oil & Gas company, Rosneft Oil Company through its affiliate Petrol Complex PTE LTD have signed the Deed of Establishment of the joint venture company named PT Pertamina Rosneft Pengolahan dan Petrokimia (PRPP), that will develop and operate the New Grass Root Refinery and Petrochemical Complex (NGRR) in Tuban, East Java.

The signing of the Deed of Establishment took place in the 3-hours priority service lounge of the Investment Coordinating Board (BPKM) Jakarta office on Nov. 28, 2017. The entire process took approximately 3 hours and was fully facilitated by the BPKPM Priority Service team.

Pertamina and Rosneft have agreed on the composition of the Joint Venture Company (PRPP), in which Pertamina and Rosneft own 55 percent and 45 percent respectively of the total share.

NGRR Tuban is planned to have 300,000 barrels of crude processing capacity.

Achmad Fathoni Mahmud, the Director of Kilang Pertamina said that the NGRR Tuban project will give enormous social and economic benefit to the nation and to the country in the future.

“This project will improve our independence and energy security by increasing the national fuel production with Euro V quality, and producing raw petrochemical products,” he said.

He then added that the NGRR Tuban Mega Project will also generate employment opportunities with an estimated size of 20.000-40.000 manpower during the development project and about 2.000 once the refinery operation commences.

Furthermore, Fathoni mentioned that the project will give a long list of positive impacts in terms of tax advantages to the government, which further leads to improvement of the national and regional economy.

The estimate fuel product that will be produced by NGRR Tuban is 80,000 barrels of gasoline, 99,000 barrels of diesel, and 26,000 barrels of jet fuel. For petrochemical products, the refinery will produce an estimate of 1.3 mmtpa of polypropylene, 0.65 million tons per annum (mmtpa) of polyethylene, 0.5 mmtpa of styrene and 1.3 mmtpa of paraxylene.

Deputy of Investment Services of BKPM, Lestari Indah, mentioned that BKPM is fully supportive of the establishment of a joint venture company PT PRPP between Pertamina and Rosneft.

“Establishment of PT PRPP in the oil refining business with plans to employ up to 40,000 workforces during the construction phase is an implementation of one of the National Strategic Projects that is hoped to provide a more balanced supply and demand of fuel products and to generate positive economic benefits to the country,” explained Lestari.

The following is the composition of the Board of Directors of PT Pertamina Rosneft Pengolahan dan Petrokimia:

  • President Director : Amir H. Siagian
  • Director : Alexander Dmitriev
  • Director : Bambang Sembodo