Pertamina to boost lubricant business with Rp8 trillion investment

Pertamina Lubricant, a business unit of Indonesia’s state-owned oil and gas firm PT Pertamina, has allocated Rp8 trillion (US$890 million) for its capital expenditure this year, a company executive says. Pertamina Vice President of lubricants Supriyanto Dwi Hutomo said Rp1 trillion (US$111.2 million) will be spent on expanding overseas markets. Pertamina exported 116,797 kiloliters of lubricants last year to 19 countries, including Australia, Bangladesh, Belgium, China, Japan, Malaysia, Myanmar, the Philippines, Saudi Arabia, Singapore, Taiwan and Timor Leste. Exports have grown from 5 to 6% per year and still offers enormous potential, he says. On the domestic front, Pertamina has a whopping 60% share of the market which is estimated at 720,000 kiloliters. Local growth is projected at 2 to 3%. Pertamina currently operates three lubricant blending plants in Jakarta, Cilacap, Central Java, and Surabaya, with a total annual capacity of 560,000 kiloliters. The lubricant business generated Rp9 trillion (US$1 billion) in revenues last year, which is expected to increase by 13% to Rp10.2 trillion (US$1.1 billion) this year. (February 7, 2012)