PERTAMINA TO BUILD PETROCHEMICAL PLANT OF 1 MILLION TON/YEAR CAPACITY

PT Pertamine (Persero) sets to dominate up to 80% of national petrochemical market by 2015, and the company believed that it can be achieved through cooperation with national and multinational corpora­tions.

On the preliminary stage, Pertamina will real­ize naphta cracker plant with a capacity of 1 million ton per year and with miscellaneous leading petro­chemical products. This project is estimated to re­quire an investment of not less than USD 5 billion.

To realize the plan, Pertarnina has signed a Memorandum of Understanding (MoU) with three multinational petrochemical corporations, namely SK Global Chemical, PT Global Chemical, and Mitsubishi Corporation, all of which are renowned petrochemi­cal corporations in Asian region. Four months since the signing of the MoU, Pertarnina will decide one of the three corporations which meets the criteria, es­pecially competence and capacity in technology field, business netvverk, and finance, as a business partner for the development of riaphta cracker project. The nephta cracker plant is set to operate by 2017 with production of ethylene at 250,000 ton/year, polyeth­ylene at 400,000 ton/year, polypropylene at 350,000 ton/yeer, and PVC at 200,000 ton/year.

Pertamina with selected partner will conduct a feasibility study which will be completed by the end of 2013. The signing and the inauguration of joint venture corporation for the construction of petro­chernical plant which will mark the awakening of two national petrochemical industries after the 1970s will be conducted in December 2013.

“Pertamina will decide minimum share owner­ship in the !pint venture company at 51%. Pertamina received full support from the government and we are highly committed to realize this project as a form of support to the government in reducing dependence of national industries on imported petrochemicals”, Perteminers Director of Marketing and Commerce, Hanung Budaya, told Business News (12/14).

Currently, petrochemical import is estimated to reach around USD 5 billion a year. And, Pertarnina has supplied around 10% of national petrochemical demand.

“After the naphta cracker plant has been constructed, we expect to reduce 39% of market share by 2017, where at that time, national petrochemical market is estimated to reach USD 30 billion. On the next stage, Pertarnina expects to dominate national petrochemical market up to 80% by 2025. With raw rnatenat support derived from Indonesia's nature, Per­tamina's capacity as the biggest refinery asset owner in Southeast Asia and with cooperation with the best partner, we believed that the target can be achieved”.

Before the naphta cracker project is operat­ing, the joint venture corporation between Pertamina and partner will cooperate in conducting marketing of petrochemical products in domestic and regional markets. With the role of Pertarnina, it is expected that petrochemical market, especially domestic one, will be more kompetitive and efficient with reliability of a more waranteed supply.

Public Relations Communications of Up­stream Oil and Gas Industry (FKK-Hulu Migas) stated that it will soon intensify socialization of strategic role played by upstream oil and gas industry to all stakeholders. This is to make the society have a better un­derstanding of the positive contribution of upstream oil and gas industry and to straighten out any misun­derstandings, such as lack of efficiency, being profit­eble to foreign party, and mistakes about upstream and downstream oil and gas industries.

The central role of oil and gas industry as one of the strategic industries is diminishing. “Public vela irons function in upstream oil and gas industry must work harder in providing information and understand­ing more openly so that public perception of the in­dustry’s role will become positive”, Joang Laksanto of FKK Migas, told Business News (12/13).

The importance of the role of public relations is becoming more evident following the issuance of ruling of the Constitutional Court dissolving BPMIGAS on November 13, 2012. Even, this was confirmed by the Minister of Energy and Mineral Resources, Jero Wacik, as Head of Temporary Work Unit of Upstream Oil and Gas Operational Activities (SKMIGAS).

All public relations functions of upstream oil and gas industry joined under FKK will be more inten­sively socializing miscellaneous works of oil and gas practitioners supporting national economic stability and development. While in fact, upstream oil and gas gives a significant contribution to the state, among other things, in producing more than 25% of total state income, namely USD 35 billion in 2011. This sector has also given contribution up to 7% of GDP and provided hundreds of thousands of work oppor­tunities, developed major infrastructures for domestic energy consumption, and provided support and devel­opment of local community through sustainable CSR program.

FKK-Hulu Migas is a forum established since 2009 where in 2009 - 2012 it was chaired by Mochammed Harun (Partamina). This forum is expected to be one of the foundations in assisting acceleration of upstream oil and gas activities across Indonesia. (E)

Business News - December 19, 2012