Pertamina Team up with Taiwan’s CPC Builds Naphta Cracking Plant in Indonesia

President Joko Widodo injects capital Rp2.1 trillion (US$141.89 million) to PT Pertamina to improves the capital structure of state-owned energy producer - Photo by the Company

JAKARTA (TheInsiderStories) – State-owned oil and gas holding PT Pertamina and its Taiwanes partner CPC Corp., is looking to establish a naphtha cracking plant in Indonesia, said the company on Sunday (03/06).

The Indonesian operator is committed to diversifying its business into new and renewable energy segments as support for the government program for energy mix that targets new and renewable energy portions of 25 percent by 2025.

CPC estimating, it will take an investment around US$700 million to construct a new plant with an annual capacity of 1 million metric tons of ethylene. The Indonesian firm is now looking to establish a joint venture with CPC to build a new facility in the country.

CPC’s Vice President Huang Jen-hung said, Pertamina itself has proposed four possible locations for the new naphtha cracking plant. An assessment report on the construction of the new naphtha cracker is expected to be completed around late November, Huang said.

Recently CPC has been set up to build and operate a lubricant oil blending plant together with a solvent and chemicals storage complex in Vietnam and thence from that base to explore the Southeast Asian market for those products.

This project is the second investment case for CPC under the New Southbound Policy, the first being Daihai Petroleum Corporation – an LPG import and marketing joint-venture, located in the port city of Haiphong in northern Vietnam – along with TASCO Group, Chin Lead Company and HPI Company’s local branch.

Meanwhile, the largest energy producer Pertamina looking Iran and other countries to expand its wings in global markets. The company had officially submitted a proposal on two Iranian development fields Ab-Teymour and Mansouri oilfield to the National Iranian Oil Company earlier this year.

Beside looking Iran, in late 2017, the Jakarta-based national oil company signed a memorandum of understanding with Algeria’s state-owned Sonatrach. At present, its subsidiary PT Pertamina Internasional EP, has participating interests at three oil and gas fields in Algeria, namely at the MLN field with a 65 percent interest, the EMK field with 16.9 percent and the OHD field with 3.73 percent.

In August of 2017, Pertamina completed the acquisition of 24.5 per cent stake in French oil and gas company Maurel et Prom. Pertamina, currently, is exploring to operate and get into Maurel et Prom’s block management.

Maurel has control over several blocks that are already producing and exploring. The blocks are located in a number of countries, including Canada, France, Italy, Myanmar, Namibia, Colombia, and Gabon.

In November 2017, 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, that will develop and operate the New Grass Root Refinery and Petrochemical Complex in Tuban, East Java.

Pertamina and Rosneft have agreed on the composition of the Joint Venture Company, in which Pertamina and Rosneft own 55 percent and 45 percent respectively of the total share. Refinery Tuban is planned to have 300,000 barrels of crude processing capacity.

Pertamina estimated that its total LPG sales would soar to more than 7.5 million metric tons this year, up from an estimated figure of 7.2 million metric tons last year. About 60 percent of this year’s figure will be met through imports.

Recently the company announced will spend $3.24 billion on its upstream business in 2018—a 21 percent rise from a year earlier. Most of the upstream budget will be invested in domestic fields, notably in the Mahakam block in East Kalimantan, which Pertamina has bought from French’s Total EP and Japan’s Inpex Ltd, as well as in the Jambaran gasfield after acquiring ExxonMobil’s 41.4 percent stake in 2017.


  1. As an owner of the LNG downstream business with an ownership in:
    1. Floating Storage and Regasification Unit (FSRU) at Jakarta Bay, West Java, with 60% share in PT Nusantara Regas, along with other shareholder namely PT PGN (Persero), Tbk.
    2. Perta Arun Gas which is a Subsidiary of PT Pertamina Gas as the operator of Arun Regasification & Terminal LNG.
  2. As a seller of LNG for existing contracts from Badak – Bontang refinery, including a contract extension for Japanese buyers. Pertamina also serves as the seller of the state’s LNG part for the contracts whose buyer is Tohoku Electric, Japan from Tangguh LNG refinery. Since 1977, Pertamina has developed the LNG market by operating Arun – Aceh and Badak – Bontang LNG Refineries. LNG sales Indonesia has penetrated the export markets in Japan, Korea and Taiwan.