Page 9 - DMEA Week 30
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DMEA refininG DMEA
ADNOC agrees broad deal with Pertamina
middle eAst
ABU Dhabi National Oil Co. (ADNOC) announced a deal last week with Indonesian counterpart PT Pertamina that will see the pair collaborate on projects throughout the oil and gas value chain.
The deal covers upstream projects in the UAE and midstream and downstream projects in Indonesia. A statement from ADNOC said that these would include refining and petro- chemicals, lique ed natural gas (LNG), lique ed petroleum gas (LPG), aviation fuel and fuel retail opportunities in Asia and transport, and trading and storage in the Emirates.
A comprehensive strategic framework (CSF) for the collaboration was signed during a state visit to Jakarta by Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed.
Meanwhile, Reuters quoted Pertamina spokeswoman Fajriyah Usman as saying that ADNOC had joined a tender for the upgrade of the Balikpapan re nery, with Pertamina antici- pating the selection of a partner for the project in October. e rst phase is envisioned costing $3-3.5bn.
It was reported that the Indonesian rm had invited bids from Japanese rm JX Nippon Oil & Gas and Azerbaijan’s SOCAR.
e expansion and upgrade of Balikpapan was a key campaign pledge by incumbent Presi- dent Joko Widodo, who was re-elected in April.
Balikpapan forms part of the country’s slow-moving Re ning Development Masterplan (RDMP), launched in 2014, covering two green- eld projects alongside ve brown eld schemes.
e overarching aim of the RDMP is raise total capacity from around 1.2mn barrels per day at present to 2.3mn bpd by 2025, thereby
eliminating costly oil product imports while improving the quality of locally produced fuel.
ADNOC is not the only Middle Eastern state rm to have eyes on Indonesia’s growing down- stream sector. In April, Pertamina announced that it would be prolonging negotiations with Saudi Aramco over their planned joint develop- ment of a re nery in Central Java.
Aramco is provisionally committed to invest- ing in the estimated $5.7bn upgrade and expan- sion of the Cilacap refinery, but the scheme is su ering delays over the partners’ di ering enterprise valuations and other issues.
e pair formed a joint venture (JV) in 2016 to own, operate, expand and upgrade the facility to process 400,000 bpd of crude into high-value fuels and basic petrochemicals.
Pertamina said at the time that the partners had agreed to hire financial advisors to help bring a resolution to the disagreement over val- uation, noting that talks would be extended by three months.
Earlier in the year, the Indonesian rm had said that if talks with Aramco were to break down, Pertamina would proceed alone, target- ing an operational date of 2025. e Jakarta Post reported last week that negotiations with Ara- mco remained ongoing.
Meanwhile, Pertamina has been in talks with Omani companies since at least 2016 to invest in a grassroots re nery at Bontang in East Kali- mantan, in the east of Borneo Island, signing a framework agreement with Oman’s Overseas Oil & Gas (OOG) in December 2018.
In April, OOG announced it was seeking partners to co-invest in the 300,000 bpd, mul- ti-billion dollar green eld facility.
Week 30 01•August•2019 w w w . N E W S B A S E . c o m P9
