Pertamina cuts capacity of Banten refinery

Indonesia’s state-owned oil and gas company Pertamina and its partners, National Iranian Oil Refining and Distribution Company (NIORDC) and Malaysia’s Petrofield Refining Company, have scaled back the capacity of their proposed refinery in Banten, Western Java, by 50% to 150,000 barrels per day (bpd) due to prevailing high crude prices, an official said. Pertamina, NIORDC and Petrofield signed a joint venture agreement in Tehran in March to construct a 300,000 bpd refinery in Banten province on March 12. Pertamina is to hold a 40% stake in the plant, with NIORDC holding 40% and Petrofield 20%. Libyan crude is more expensive than Iranian so the partners have decided to halve the proposed refinery’s capacity. The Banten refinery was previously forecast to cost US$6 billion, but the reduction in capacity has lowered the expected outlay to between US$3 billion and US$4 billion. (May 21, 2008)