Pertamina-Aramco Premature Partnership

After there was no certainty for almost 6 years, the collaboration between PT Pertamina (Persero) and Saudi Aramco Oil Co. the Cilacap Refinery development project can no longer be maintained.

Efforts to merge the strengths of the two state-owned oil and gas companies withered before they flourished. The decision to separate was disclosed by Pertamina through VP Corporate Communication Fajriyah Usman who stated the cooperation between Pertamina and Aramco in the project was no longer extended.

Fajriyah Usman

"After the extension of cooperation with Saudi Aramco was not carried out, Pertamina continued the Cilacap Refinery Development Master Plan (RDMP) independently, but in parallel, there would still be another strategic partner search," She said.

Nicke Widyawati

No immediate agreement was reached on the cooperation scheme until the valuation of the Cilacap Refinery was the main cause. Last February, Pertamina President Director Nicke Widyawati asserted that his party would still be waiting for offers from Aramco until the end of the first quarter / 2020 or March 2020.

Premature Partnership

It all started in 2014 ago. Pertamina began selecting partners in the Cilacap RDMP by submitting initial estimates of a number of aspects to the project such as capital expenditure of US $ 3 billion to the US $ 3.5 billion and an internal rate of return (IRR) of 15%. Through the development of the RDMP project, refinery processing capacity will increase from 348,000 barrels per day (BPD) to 370,000 BPD.

In addition, there will also be an increase in gasoline (gasoline) production from 59,000 BPD to 138,000 BPD and diesel dad production of 82,000 BPD to 137,000 BPD. With a current capacity of 348,000 BPD or 33% of the capacity of the oil refinery operated by Pertamina, the Cilacap Refinery is the largest refinery in Indonesia. The first phase of the Cilacap refinery has been operating since 1976 with a capacity of 118,000 BPD, while the Cilacap II refinery has operated since 1983 with a capacity of 230,000 BPD.

The resulting products are in the form of fuel oil (BBM) such as gasoline with octane RON 88 (Premium) and Ron 92 (Pertamax), kerosene, Solar, to avtur. Besides fuel, the Cilacap refinery also produces LPG, asphalt, sulfur, and petrochemical products such as benzene and propylene. The project is targeted to be completed in 2025 in order to pursue national energy security and independence which is marked by the stop of importing BBM in 2026.

The start of the partnership was marked by the election of Aramco as a partner with the signing of the MoU in December 2014 followed by The signing of the head of agreement (HOA) in 2015. In 2016, Aramco and Pertamina agreed on a number of key business principles through a joint venture development agreement (JVDA) with the majority portion being owned by Pertamina at 55% and the rest owned by Aramco.

One year ago, in 2017 both completed basic engineering designs with a refinery capacity of 400,000 BPD and an estimated capital expenditure of US $ 5.8 billion. After that, the collaborative process began to face a number of challenges. In 2018, Aramco requested that the Government of Indonesia obtain fiscal incentive facilities, including tax holidays.

Medio 2018, Pertamina has reached the progress of completing three Aramco requests, namely the granting of a tax holiday for 20 years, land acquisition, and approval of the Cilacap Refinery Business Unit (RU) IV spinoff along with the valuation results of the business unit. Regarding valuation, Pertamina has appointed Price Waterhouse Coopers (PWC) as an independent consultant to calculate the results that have been submitted to Aramco, namely an equity value of the US $ 3.98 billion, equivalent to US $ 5.18 enterprise value.

On November 19, 2018, at a high-level meeting in Jakarta, Aramco said that it would review the results of the RDMP valuation IV Cilacap and immediately deliver the results to Pertamina. Signs of the end of the Pertamina-Aramco partnership began to appear as the project valuation was not immediately agreed upon.

Time continued to roll and the signal to search for new partners was given by SOE Minister Erick Thohir on 29 October 2019, after attending the meeting coordination with the Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan. On the other hand, Pertamina actually shows its desire to partner with Aramco. Other collaboration alternatives were also proposed to Aramco, namely the only cooperated asset was the project new ones, and existing refineries are not included.

However, the offer did not seem to meet an agreement. The Pertamina-Aramco story at the Cilacap refinery in Central Java still ends prematurely. Meanwhile, Special Staff of the Ministry of SOEs Arya Sinulingga said that Aramco's withdrawal from its partnership with Pertamina in the Cilacap RDMP project was not due to the failure of negotiations on the business scheme to be carried out.

"Because corona and oil prices are falling, so the price to the economy does not enter again," he said.

He revealed that Pertamina was currently exploring potential new partners for the project. Arya said the potential partners are oil and gas companies from abroad.

NEED PARTNER

Gadjah Mada University Energy Economics Observer Fahmy Radhi said, reflecting on the negotiation process that took place too long and does not immediately produce a solution to terminate the cooperation is appropriate. Fahmy rate, Pertamina's financial capacity is able to finance the development of the project with a number of options, both absorbing internal funds, as well as from external sources such as the issuance of debt securities. Meanwhile, in terms of technology, Pertamina is also considered capable of continuing the development of the project independently.

"If the Cilacap RDMP project is completed and operational, then Pertamina will find a partner by releasing a maximum of 49% share ownership," he said.

Meanwhile, Executive Director of the Institute for Essential Services Reform (IESR) Fabby Tumiwa believes that Pertamina will find it difficult to develop the Cilacap refinery without cooperating with strategic partners. According to Fabby, of Pertamina's total capital expenditure this year of around the US $ 7.8 billion, half is allocated for business activities upstream, while the portion for refinery construction is not large.

"The investment capability is not enough to finance large projects such as refineries which, despite multi-years financing, will require very large CAPEX," he said.

Likewise, Executive Director of the RefoMiner Institute Komaidi Notonegoro said, business partners were needed by Pertamina to mitigate existing business risks. This is because Pertamina cannot focus its capital expenditure on refinery construction, but needs to be allocated to other business portfolios.

"Generally cooperation is needed because the business strategy is to minimize risk," he said.

The end of the collaboration between Pertamina and Aramco indeed raises big questions regarding the success of the Cilacap RDMP project. A big challenge awaits Pertamina to complete the project, either independently or with other partners.

Bisnis Indonesia, Page-10, Thursday, May 28, 2020

Pertamina stops Balikpapan refinery operations from May

PT Pertamina (Persero) will stop the full operation of the Balikpapan Refinery starting in May following the decline in domestic demand for fuel oil (BBM). On the other hand, taking advantage of low world oil prices, the company will increase imports of crude oil and fuel.

Nicke Widyawati

Pertamina President Director Nicke Widyawati said, to mitigate the impact of the current conditions, his party would begin to reduce the refinery's operating capacity within certain limits according to demand conditions.

In the final scenario, the company has begun to reduce the capacity of the Balikpapan refinery this month, to finally stop its total operations for the two crude distillation units (CDU).

the Balikpapan refinery

"Starting in early May, the whole Balikpapan Refinery must stop. We use this moment to do maintenance. Where during slow down demand, some of our refineries are shut down for maintenance. So our maintenance is speeding up, "said Nicke Widyawati.

Nicke Widyawati explained that with world oil prices falling significantly and fuel consumption also being cut, the operation of the refinery in full is actually not economical and actually harms the company. However, it will continue to operate other refineries because the cessation of operation of all refineries will have an impact on the national economy.

"Refineries if only all of these operational economies are closed. But Pertamina has the responsibility as a driver of the national economy, therefore we remain in balance even though the economy is not the best, but how does Pertamina's operational impact on the national economy and job creation, "said Nicke.

He noted, since March 1, the average daily sales of fuel dropped significantly, namely 16.78% for gasoline and 8.38% for diesel compared to the daily average in January and February. Specifically, the average daily sales of gasoline in March-April recorded only 77.95 thousand kiloliters (KL) from the normal 93.66 thousand KL, while gasoline sales were only 37.84 thousand KL from the normal 41.31 thousand KL.

In fact, based on Pertamina's data, the company's fuel sales this year is targeted to reach 78.7 million KL. While related to refinery operations, still referring to the same data, the company targets crude oil processing including intermedia and gas at the national refinery this year to reach 355 million barrels, up 4% from the 2019 prognosis of 342 million barrels. While refinery production is targeted to reach 290 million barrels, up 6% from last year's prognosis of 273 million barrels.

Add Import

On the other hand, taking advantage of the drop in world crude oil prices, Nicke stated that Pertamina decided to increase its purchase of crude oil and fuel from abroad. This policy was taken because it was considered more economical. In particular, crude oil imports were 10 million barrels and gasoline 9.3 million barrels.

the Rokan Block

With this additional import, Pertamina plans to temporarily stop the purchase of domestic crude oil. Mainly from oil producers whose large production such as PT Chevron Pacific Indonesia (CPI) from the Rokan Block and Exxon Mobil Cepu Limited (EMCL) from the Cepu Block. This is because domestic oil prices are now more expensive than imports.

Exxon Mobil Cepu Limited (EMCL)

"Domestic crude has a high price, so if it is purchased, it will be heavy The COGS will increase dramatically. While imported crude is cheap, this is the right time for crude stock to be used for refineries to reduce refinery HPP. To take the opportunity for oil prices to fall, we optimize the existing storage, "explained Nicke Widyawati.

Related to the procurement of crude oil and fuel, based on Pertamina's data, the company sets the volume of crude oil imports this year at 83 million barrels, down 3% from the 2019 prognosis of 86%. Furthermore, imports of gasoline products are planned at 119 million barrels, up slightly from last year's prognosis of 118 million barrels.

Aramco

Nicke added, his party also plans to increase imports of liquefied petroleum gas / LPG by 220 thousand metric tons. The addition of LPG imports is to take advantage of the low price of LPG according to Aramco CP. Pertamina's data shows that according to the RKAP, LPG import volume originally planned was 6 million metric tons, up 3% compared to last year's prognosis of 5.8 million metric tons.

Investor Daily,  Page-9, Saturday, April 18, 2020

Saudi Arabia Increases Oil Production.

Saudi Arabia for the first time in the last decade announced a decision on increasing oil production capacity. The United Arab Emirates, its close partner at OPEC, followed a similar step.

Saudi Arabia, Wednesday, March 11, 2020, announced a decision to increase oil production capacity. This is the first time in more than a decade. This step was taken a day after Riyadh announced another step in the form of falling oil prices to be sent to the US. This action triggered the biggest oil price fall since the 1991 Gulf War.

The United Arab Emirates (UAE), a close partner of Saudi Arabia, took a similar step, namely to increase oil production capacity starting next April. Two The Gulf Arab state and members of the Organization of the Petroleum Exporting Countries have united against Russia, a non-OPEC oil producer, which rejects proposals for reducing world oil production.

The Saudi Arabian Energy Ministry has ordered oil-producing company Aramco to increase oil production capacity from 12 million barrels per day to 13 million barrels per day.

Saudi Aramco

"The company (Aramco) is exerting its utmost efforts to implement this directive as soon as possible," said Amin Nasser, CEO of Aramco.

There is no information about the time frame for implementing the policy. Increasing production capacity certainly requires billions of US dollars of investment. Aramco said the directives came from the Saudi Ministry of Energy. 

Prince Mohammed bin Salman (MBS)

    The energy policy of the royal state was generally controlled by the Crown Prince Mohammed bin Salman (MBS) and Energy Minister Prince Abdulaziz bin Salman who was still a blood relative of the MBS.

Currently, Saudi Arabia produces around 9.8 million barrels per day. This amount of production is an implementation of an agreement between OPEC and other oil-producing countries, including Russia, related to production cuts to reduce oil supply in the world market so that oil prices rise. 

    But since the end of last week, Saudi Arabia has taken dramatic steps that have triggered a collapse in oil prices. This was done after Russia refused to work together to reduce production. It is estimated, other OPEC member countries will follow the steps of Saudi Arabia.

By increasing oil production and lowering official prices for Asia, according to observers, Saudi Arabia wants to put pressure on Russia to dominate market supply and control prices. As a result of the oil price war caused by Saudi Arabia last Monday, crude oil prices dropped 25 percent, the biggest drop since the 1991 Gulf War. The price of Brent crude for May delivery fell 24 percent to 34.36 US dollars per barrel.

Selfie in Gulf War 1991

Moscow will raise the UAE, following Saudi Arabia's steps. The UAE national oil company announced Wednesday to increase supplies by more than 4 million barrels per day in April and increase production capacity to 5 million barrels per day.

The President Vladimir Putin

Moscow said Russian oil companies might also increase production to 300,000 BPD and could increase by 500,000 BPD. Russia indicated Tuesday it was ready to negotiate. However, Saudi Arabia insisted, there was little meaning if the negotiations would only confirm the inability to reach an agreement.

"Most likely the end of this crisis is the emergence of painful processes for several weeks or months until oil prices are low enough.

That way it can change the fundamental views of Moscow and Riyadh so that the two parties again reach a kind of compromise, "so the views of Eurasia Group, a political risk consulting company.

Stock market

Stock markets in Asia and Wall Street futures exchanges again depressed on Wednesday, March 11. Investors and market participants appear skeptical about Washington's stimulus package offer to fight the widespread Covid-19 outbreak, including in the United States, and the continued effects of the oil price war. 

   Many analysts say investors need to remain vigilant for further market volatility. This is because Covid-19 Wabab still raises risks to public health in many countries. If it drags on, the pressure on the global economy gets stronger.

Covid-19

The financial markets did seem to have recovered from a brutal global sell-off on Monday (March 9) triggered by a double shock, namely the collapse of oil prices and the worsening Covid-19 Plague. However, the increase appeared short-lived in early trading on Asian markets on Wednesday.

The stock market, US futures fell 1.54 percent and the MSCI index for Asia Pacific shares outside Japan dropped 0.04 percent. The Australian stock market is down 1.31 percent. Japan's Nikkei index erased earlier losses by rising 0.24 percent in early trade.

Earlier this week, US President Donald Trump said he would take "major steps" to defuse economic tensions caused by the spread of the coronavirus of the species. The headlines also focus on a discussion of the possibility of a payroll tax cut, a thing that helps lift market sentiment. However, the lack of continuation of talks on the topic has made some investors unimpressed and tend to be skeptical.

"We were promised something substantive from the Trump administration. If it hasn't come at this hour, there is a possibility of a delay, "said Michael Mc Carthy, chief market strategist at CMC Markets in Sydney Australia. "That's why the market has a negative tone.

From the perspective of global investors, there is still a lot of downside risk. " On Wall Street, the three major indices increased by almost 5 percent on Tuesday, one day after the US equity market suffered its biggest daily loss since the 2008 financial crisis.

Kompas, Page-5, Thursday, March 12, 2020

Saudi Aramco in the Cilacap Refinery Project is Immediately Confirmed

PT Pertamina (Persero) hopes to immediately obtain certainty of the continued cooperation with Saudi Aramco related to the Cilacap Refinery Project this month. Certainty is needed after a change in the cooperation scheme of the two companies. 

Pertamina offers a new cooperation scheme for the Cilacap Refinery Project because the two companies do not immediately agree on the valuation of refinery assets. The refinery project will be carried out with the same scheme used in the Balikpapan Refinery Project, which is a lease.

the Balikpapan Refinery Project

Under this scheme, Pertamina will pay the rental fees for the joint venture with Saudi Aramco which is building a new refinery unit at the Cilacap Refinery Complex. While the refinery unit which is currently in operation remains the property of Pertamina. 

Saudi Aramco

Under the new scheme, the Pertamina-Saudi joint venture Aramco will build a new refinery unit. Pertamina Investment Planning and Risk Management Director Heru Setyawan revealed that his party was still waiting for Saudi Aramco's response to the new Cilacap Refinery cooperation scheme.

Pertamina Corporate Secretary Tajudin Noor had said, his party indeed hoped the agreement with Saudi Aramco could be signed as soon as possible. Although there are still a few things that are considered by potential partners, it cannot force them to set a deadline for an agreement. 

He explained, his party and Saudi Aramco discussed the benefits obtained by each party through this collaboration. In addition, it also waits if Saudi Aramco requires special treatment (privilege) from the government or company, such as business preconditions.

Although there is no agreement yet, Tajudin stressed that the Cilacap Refinery Project will not be stopped. If indeed it and Saudi Aramco did not reach an agreement, Pertamina would find another partner or work on the refinery project in Central Java.

"We open up opportunities for all partners," he said.

For information, the Cilacap Refinery Project has no significant progress because the two state-owned oil companies did not immediately reach an agreement on the valuation of existing refinery assets. 

Nicke Widyawati

   Until the last discussion, Pertamina President Director Nicke briefly revealed the difference between the valuations calculated by Pertamina and Saudi Aramco was still very large.

Investor Daily, Page-9, Wednesday, March 4, 2020

Pertamina-OOG Discontinues Cooperation in Build Bontang Refinery

PT Pertamina (Persero) did not continue to work with the oil and gas company from Oman, Overseas Oil and Gas (OOG) Llc, in working on a new refinery with a capacity of 300 thousand barrels per day (BPD) in Bontang, East Kalimantan. Pertamina is now looking for new partners to complete the project.

Overseas Oil and Gas (OOG)

This was known in a meeting between Pertamina and the House of Representatives Commission VI on Monday (3/2). In his presentation, Pertamina reported the development of the Bontang refinery development in which the proposed Regional Spatial Plan (RSP/RTRW) had been submitted to the local regional government.

However, the company also said that the framework agreement / FWA agreement with partners had ended. The intended partner is OOG. FWA is the basis for both companies to form a joint venture / JV. This FWA is valid for 12 months. Therefore, the company formation between Pertamina and OOG should have been completed at the end of 2019. One of the things discussed in the formation of the JV is the share ownership of each company.

Pertamina Megaprocess Processing and Petrochemical Director Ignatius Tallulembang confirmed that cooperation with OOG did not continue. Furthermore, he will look for new partners in building the refinery project.

"We are open [looking for new partners]. But with Oman, we have [not continued], "he said in Jakarta.

In fact, according to Pertamina's data, the Bontang Refinery Project is targeted to start operating in the next five years or in February 2025. So far, OOG has signed a memorandum of understanding with PT Meta Epsi and PT Sanurhasta Mitra Tbk (MINA) to build the Bontang Refinery facility. The two companies will build supporting facilities (outside battery limit / OSBL), such as pipes, water treatment facilities, and fabrication.

In addition, OOG has also conducted open bidding in Singapore to engineering companies with a good reputation for conducting a financial feasibility study on 30 April 2019. This study will be used as a reference by lenders and banks to participate in funding the new refinery project.

The Bontang refinery requires a total investment of between the US $ 10-15 billion. In contrast to the cooperation between Pertamina and Rosneft Oil Company, for the Bontang Refinery Project, the funding needed to build the refinery is fully borne by OOG. While Pertamina obtained a 10% golden share as well as offtake of several products. The shareholding of this company can be increased.

Luhut Binsar Pandjaitan

Signals of continued cooperation with OOG have been voiced by the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan. The project partner at that time Luhut revealed that it could also be replaced if the performance was not good. The reason is, even though the project has been agreed since a few years ago this project has not yet been completed.

"What [Omani] company we want to find is a possible partner with Abu Dhabi, ADNOC or whatever," he said.

However, in fact, the oil and gas company from the United Arab Emirates actually did not enter the Bontang Refinery Project. The Abu Dhabi National Oil Company (ADNOC) agreed to explore further the potential of developing the Integrated Petrochemical Refinery Complex in Balongan, West Java. Pertamina and Adnoc signed a memorandum of understanding at the end of last year.

Mubadala Petroleum

While Mubadala Investment Company, a financial investment company from the United Arab Emirates (UAE), is interested in becoming an investor in the Balikpapan Refinery Project worth the US $ 5.5 billion. Pertamina has signed a principle agreement or Refinery Investment Principle Agreement to further evaluate investment cooperation opportunities in the processing sector.

Saudi Aramco

The agreement will provide a clear structure to ensure cooperation as a pathway to potential joint investment. Not only Bontang Refinery, but Pertamina also does not have an agreement with Saudi Aramco regarding the continued cooperation in capacity building and upgrading of the Cilacap Refinery.

After the asset valuation polemic that never ended, the two agreed to change the cooperation scheme into a lease. Under this scheme, Pertamina will pay the rental fees for the joint venture with Saudi Aramco which is building a new refinery unit at the Cilacap Refinery Complex. While the refinery unit which is currently in operation remains the property of Pertamina.

Nicke Widyawati

"The target is that we will agree to a leasing agreement within the next month. And if this happens, then the deal will happen, after that, we will carry out development, "said Pertamina President Director Nicke Widyawati.

The Bontang and Cilacap refineries are part of the six refinery projects developed by Pertamina. In addition to the Bontang refinery, another new refinery project developed by the company is Tuban Refinery in East Java. While the upgrading projects undertaken by other companies are in Balikapapan, East Kalimantan, in Balongan, West Java, and Dumai, Riau.

Arifin Tasrif 

Previously, Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif encouraged the speeding of the refinery project undertaken by Pertamina. The refinery upgrading project is expected to start operating in the second period of President Joko Widoro's government. While the new refinery project has at least begun the construction phase.

IN INDONESIA

Pertamina-OOG Tidak Lanjutkan Kerja Sama Membangun Kilang Bontang

PT Pertamina (Persero) tidak melanjutkan kerja sama dengan perusahaan minyak dan gas dari Oman, Overseas Oil and Gas (OOG) Llc, dalam mengerjakan kilang baru berkapasitas 300 ribu barel per hari (bph) di Bontang, Kalimantan Timur. Pertamina kini mencari mitra baru untuk merampungkan proyek tersebut.

Hal ini diketahui dalam rapat antara Pertamina dan Komisi VI DPR RI pada Senin (3/2) lalu. Dalam presentasinya, Pertamina melaporkan perkembangan pembangunan Kilang Bontang di mana usulan Rencana Tata Ruang Wilayah (RTRW) telah disampaikan kepada pemerintah daerah setempat. 

Namun, perseroan juga menyampaikan bahwa kesepakatan frame work agreement/FWA dengan mitra telah berakhir. Mitra yang dimaksud adalah OOG. FWA merupakan dasar bagi kedua perusahaan untuk membentuk joint venture/JV. FWA ini berlaku selama 12 bulan. Sehingga, seharusnya pembentukan perusahaan antara Pertamina dan OOG ini rampung di akhir 2019 lalu. Salah satu hal yang dibahas dalam pembentukan JV adalah kepemilikan saham masing-masing perusahaan.

Direktur Megaproyek Pengolahan dan Petrokimia Pertamina Ignatius Tallulembang membenarkan bahwa kerja sama dengan OOG tidak berlanjut. Selanjutnya, pihaknya akan mencari mitra baru dalam membangun proyek kilang tersebut.

“Kami open [cari mitra baru]. Tetapi dengan Oman, kami sudah [tidak dilanjutkan],” kata dia di Jakarta.

Padahal, mengacu data Pertamina, Proyek Kilang Bontang ditargetkan mulai beroperasi dalam lima tahun ke depan atau pada Februari 2025. Sejauh ini, OOG telah menandatangani nota kesepahaman dengan PT Meta Epsi dan PT Sanurhasta Mitra Tbk (MINA) untuk membangun fasilitas Kilang Bontang. Kedua perusahaan ini akan membangun fasilitas pendukung (outside battery limit/OSBL), seperti pipa, fasilitas water treatment, dan fabrikasi. 

Selain itu, OOG juga telah melakukan open bidding di Singapura kepada perusahaan engineering dengan reputasi bagus untuk melakukan kajian kelayakan finansial pada 30 April 2019. Kajian ini akan digunakan sebagai acuan oleh para pemberi pinjaman dan perbankan untuk turut serta mendanai proyek kilang baru tersebut.

Kilang Bontang membutuhkan total investasi antara US$ 10-15 miliar. Berbeda dengan kerja sama Pertamina dan Rosneft Oil Company, untuk Proyek Kilang Bontang, pendanaan yang dibutuhkan dalam membangun kilang ditanggung sepenuhnya oleh OOG. Sementara Pertamina memperoleh golden share 10% sekaligus sebagai offtaker beberapa produk. Bagian kepemilikan saham perseroan ini dapat ditingkatkan.

Sinyal tidak berlanjutnya kerja sama dengan OOG ini pernah disuarakan oleh Menteri Koordinator Kemaritiman dan Investasi Luhut Binsar Pandjaitan. Mitra proyek ini saat itu Luhut mengungkapkan juga dapat diganti jika kinerjanya tidak bagus. Pasalnya, meski proyek sudah disepakati sejak beberapa tahun lalu proyek ini belum juga rampung.

“Yang [perusahaan] Oman kami mau carikan mitra mungkin dengan Abu Dhabi, ADNOC atau mana,” kata dia.

Namun, nyatanya, perusahaan minyak dan gas asal Uni Emirat Arab itu justru tidak masuk ke Proyek Kilang Bontang. Abu Dhabi National Oil Company (ADNOC) sepakat mendalami lebih lanjut potensi pengembangan Kompleks Kilang Terintegrasi Petrokimia di Balongan, Jawa Barat. Pertamina dan Adnoc telah menandatangani nota kesepahaman pada akhir tahun lalu.

Sementara Mubadala Investment Company, perusahaan investasi keuangan dari Uni Emirat Arab (UEA), berminat menjadi investor dalam Proyek Kilang Balikpapan senilai US$ 5,5 miliar. Pertamina telah meneken perjanjian prinsip atau Refinery Investment Principle Agreement untuk mengevaluasi lebih lanjut peluang kerja sama investasi di sektor pengolahan. 

Perjanjian tersebut akan memberikan struktur yang jelas untuk memastikan kerja sama sebagai jalur menuju investasi bersama yang potensial. Tidak hanya Kilang Bontang, Pertamina juga belum memiliki kesepakatan dengan Saudi Aramco terkait kelanjutan kerja sama peningkatan kapasitas dan perbaikan (upgrading) Kilang Cilacap. 

Setelah polemik valuasi aset yang tidak kunjung usai, keduanya sepakat mengubah skema kerja sama menjadi sewa. Dalam skema ini, Pertamina akan membayar biaya sewa terhadap perusahaan patungan dengan Saudi Aramco yang membangun kilang unit baru di Komplek Kilang Cilacap. Sementara unit kilang yang saat ini sudah beroperasi tetap menjadi milik Pertamina.

“Targetnya, kami dalam maksimum satu bulan ke depan akan menyepakati leasing agreement. Dan kalau ini terjadi, maka deal itu akan terjadi, setelah itu kami akan melakukan pembangunan,” kata Direktur Utama Pertamina Nicke Widyawati.

Kilang Bontang dan Cilacap merupakan bagian dari enam proyek kilang yang dibangun Pertamina. Selain Kilang Bontang, proyek kilang baru lainnya yang dibangun perseroan yakni Kilang Tuban di Jawa Timur. Sementara proyek upgrading yang dikerjakan perseroan lainnya adalah di Balikapapan, Kalimantan Timur, di Balongan, Jawa Barat, dan Dumai, Riau. 

Sebelumnya, Menteri Energi dan Sumber Daya Mineral (ESDM) Arifin Tasrif mendorong percepat proyek kilang yang dikerjakan oleh Pertamina. Untuk proyek upgrading kilang, diharapkan sudah mulai beroperasi di periode kedua pemerintah Presiden Joko Widoro ini. Sementara proyek kilang baru setidaknya sudah mulai tahap konstruksi.

Investor Daily, Page-9, Wednesday, Feb 5, 2020

February, Cilacap Refinery Agreement Targets Complete

PT Pertamina (Persero) is targeting an agreement with Saudi Aramco regarding the Cilacap Refinery to be completed within the next month. The construction of the refinery project will also be accelerated until it only takes three years.

Nicke Widyawati

Pertamina President Director Nicke Widyawati said that his party and Saudi Aramco had agreed to change the cooperation scheme in the work of the Cilacap Refinery Project. The project will be carried out with the same scheme used in the Balikpapan Refinery Project, which is rent.

Under this scheme, Pertamina will pay the rental fees for the joint venture with Saudi Aramco which is building a new refinery unit at the Cilacap Refinery Complex. While the refinery unit which is currently in operation remains the property of Pertamina. Because there is no asset spin-off, there is no need for an existing asset valuation agreement.

"The target is that we will agree to a leasing agreement within the next one month. And if this happens, then the deal will happen, after that, we will carry out development, "said Nicke Widyawati in Jakarta.

Nicke Widyawati

Nicke Widyawati explained that the change in the scheme was because the two state-owned oil and gas companies did not immediately reach an agreement on the valuation of the existing refinery assets. 

     Until the last discussion, the difference between the valuations calculated by Pertamina and Saudi Aramco was still large. On the other hand, Pertamina has a book value as a minimum limit to release (spin-off) assets.

"This offered by Saudi Aramco is far lower than the book value. If this is done, there will be a loss, so it can't be. We have told Saudi Aramco that there is a limit on book value as a minimum, "said Nicke.

This consideration is only in terms of the fiscal value of the Cilacap Refinery. In terms of fuel production, the Cilacap refinery currently produces more than 30% of total national fuel production. Therefore it cannot release the refinery assets below book value as offered by Saudi Aramco.

Under the new scheme, the Pertamina-Saudi joint venture Aramco will build a new refinery unit. Later this new unit will increase the capacity of the Cilacap Refinery from the current 349 thousand Barrels Per Day (BPD) to 400 thousand BPD. If there is still no agreement with Saudi Aramco, it will work on the refinery project and will look for new partners when the development process is already underway.

"If Aramco does not agree, we will continue on our own," said Nicke.

It also seeks to speed up the construction of the Cilacap Refinery, which normally takes four years. One of them will combine the detailed contract design (front end engineering design / FEED) and engineering, procurement, and construction (engineering, procurement, and construction / EPC). This has been done by the company for the Balongan Refinery Project.

"With this mechanism, we can accelerate [the construction period] by 14 months. We propose this to our partners [in the refinery project], "said Nicke.

The Cilacap refinery is targeted to start operating in 2025. After upgrading, there will be an additional production of 80 thousand BPD of gasoline, 60 thousand BPD of diesel fuel, and aviation fuel of 40 thousand BPD. Fuel production increased significantly because the ability of refineries to process crude oil into ready-to-sell products (NCI) rose from 74% to 92-98%.

IN INDONESIA

Februari, Kesepakatan Kilang Cilacap Ditargetkan Rampung

PT Pertamina (Persero) menargetkan kesepakatan dengan Saudi Aramco terkait Kilang Cilacap dapat rampung dalam satu bulan ke depan. Konstruksi proyek kilang ini juga akan dipercepat hingga hanya memerlukan waktu tiga tahun. 

Direktur Utama Pertamina Nicke Widyawati mengatakan, pihaknya dan Saudi Aramco telah menyepakati perubahan skema kerja sama dalam pengerjaan Proyek Kilang Cilacap. Proyek tersebut akan dikerjakan dengan skema yang sama yang dipakai di Proyek Kilang Balikpapan, yakni sewa. 

Dalam skema ini Pertamina akan membayar biaya sewa terhadap perusahaan patungan dengan Saudi Aramco yang membangun kilang unit baru di Komplek Kilang Cilacap. Sementara unit kilang yang saat ini sudah beroperasi tetap menjadi milik Pertamina. Lantaran tidak ada spin off aset, maka tidak perlu ada kesepakatan valuasi aset yang ada.

“Targetnya, kami dalam maksimum satu bulan ke depan akan menyepakati leasing agreement. Dan kalau ini terjadi, maka deal itu akan terjadi, setelah itu kami akan melakukan pembangunan,” kata Nicke Widyawati di Jakarta.

Nicke Widyawati menjelaskan, perubahan skema ini lantaran kedua perusahaan minyak dan gas milik negera ini tidak segera mencapai kesepakatan valuasi aset kilang eksisting. Hingga diskusi terakhir, selisih antara valuasi yang dihitung Pertamina dan Saudi Aramco masih sabgar besar. Di sisi lain Pertamina memiliki nilai buku sebagai batas minimum untuk melepas (spin off) aset.

“Ini yang ditawar oleh Saudi Aramco jauh lebih rendah dari nilai buku. Kalau ini dilakukan, maka akan ada kerugian, jadi tidak bisa. Kami sudah sampaikan ke Saudi Aramco bahwa ada batasan nilai buku sebagai batasan minimal,” papar Nicke.

Pertimbangan itu hanya dari sisi nilai fiskal Kilang Cilacap. Dari sisi produksi bahan bakar minyak (BBM), Kilang Cilacap saat ini memproduksi lebih dari 30% dari total produksi BBM nasional. Karenanya pihaknya tidak bisa melepas aset kilang di bawah nilai buku seperti yang ditawar Saudi Aramco. 

Pada skema baru, perusahaan patungan Pertamina-Saudi Aramco akan membangun kilang unit baru. Nantinya unit baru ini akan menambah kapasitas Kilang Cilacap dari saat ini 349 ribu barel per hari (bph) menjadi 400 ribu bph. Jika tetap tidak ada kesepakatan dengan Saudi Aramco, pihaknya akan menggarap proyek kilang ini dan akan mencari mitra baru saat proses pengembangan sudah berlangsung.

“Kalau Aramco tidak setuju, kami lanjut sendiri,” tegas Nicke.

Pihaknya juga berupaya mempercepat konstruksi Kilang Cilacap yang biasanya membutuhkan waktu empat tahun. Salah satunya pihaknya akan menggabungkan kontrak desain rinci (front end engineering design/FEED) dan rekayasa, pengadaan, dan konsturksi (engineering, procurement, and construction/EPC). Hal ini sudah dilakukan perseroan untuk Proyek Kilang Balongan.

“Dengan mekanisme ini, kami bisa percepat [masa konstruksi] 14 bulan. Ini kami propose ke partner-partner kami [dalam proyek kilang],” ujar Nicke. 

Kilang Cilacap ditargetkan mulai beroperasi pada 2025. Pasca upgrading, akan ada tambahan produksi bensin (gasoline) 80 ribu bph, solar 60 ribu bph, dan avtur 40 ribu bph. Produksi bahan bakar naik signifikan karena kemampuan kilang mengolah minyak mentah menjadi produk siap jual (NCI) naik dari 74% menjadi 92-98%.

Investor Daily, Page-9, Monday, Feb 3, 2020