Pertamina subsidiary bares plan to acquire Shell’s fuel terminal in Gresik

PT Pertamina Patra Niaga, a subsidiary of Indonesia’s state-owned energy company PT Pertamina, plans to acquire Shell’s fuel distribution terminal in Gresik, East Java, for USD40 million, according to Jakarta Post.

Currently, Patra Niaga leases storage tanks from various third parties to support its fuel-trading business in Batam, Riau Islands and Samarinda, East Kalimantan.

The plan to acquire Shell’s Gresik Distribution Terminal (GDT), which has a storage capacity of 35,000 kilolitres, will strengthen Patra Niaga’s supply chain in Java.

“All this time, Pertamina has been using a floating storage terminal to store its aviation fuel for Bali and the rent is very high,” said Said Reza Pahlevy, Patra Niaga’s administration and finance director. “By using Patra Niaga’s terminal service at the Gresik facility, Pertamina can reduce the rent by 50 to 60%.”

Patra Niaga has allocated IDR1 trillion (USD74.6 million) to pay for this planned expansion, of which more than half will be used to acquire the Gresik terminal. The balance will be invested in the first development phase of an industrial estate in Dumai, Riau Islands, with a total area of 240 hectares. In the industrial estate, the company plans to develop an asphalt storage terminal with a capacity of 21,000 tonnes, an aviation fuel storage tank with a capacity of 2,500 kilolitres and a liquefied petroleum gas (LPG) storage tank with a capacity of 10,000 tonnes.

“We have kicked off the development of the asphalt terminal and expect it to commence operations next year,” Patra Niaga President Director Gandhi Sriwidodo said.