INDONESIA: Pertamina, PTTGC move to next level in proposed petrochemical complex

Having completed a preliminary feasibility study, the partners expect to finalize project details by early 2014.

This will be followed by a detailed bankable feasibility study and front end engineering design. A final investment decision is expected in 2015.

Pertamina and PTTGC said the two companies "have reached the project definition understanding, including a common goal and objective, a competitive investment model and appropriate site specification, as well as each party's strength to be leveraged for building the joint venture's competitiveness."

PTTGC President and Chief Executive Bowon Vongsinudom disclosed that the complex will include "a world-scale cracker and integrated downstream units,” which are targeted to begin commercial operations by 2018. The preliminary investment is estimated to be about USD 5-billion.

Pertamina will hold a majority 51 % interest in the venture, with PTTGC holding 49 %. However, based on the agreement, the joint venture structure allows PTTGC to seek a potential third party for a portion of its stake.

Pertamina and PTTGC also plan to enter into a marketing and trading joint venture to initially conduct both companies' polymer products marketing and distribution throughout Indonesia.

Source: Weekly "PetroChemical News", Durham, NC, USA; 16 Dec 2013(Syed Rashid Ali, Karachi, Pakistan)