Rosneft and Pertamina signed within the working visit of Rosneft’s Chief executive officer Igor Sechin to Indonesia a number of documents aimed at further development of cooperation between the companies.
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The agreements reached cover all key areas of their business activities. Rosneft and Pertamina signed an Agreement envisaging the creation of a Joint Venture (JV) with the scope of implementing the project for the construction of the Tuban refining and petrochemical complex to be located in the eastern part of Java (Indonesia).
The design capacity of primary processing at the Tuban complex is planned to stand at 15 million MTA. It will run on imported medium and heavy grades of sour crude. The project provides for the construction of a large fuel oil catalytic cracker and a petrochemical complex. The complex is assumed to be able to accommodate VLCC supertankers with deadweight of up to 300 thousand tonnes.
The document specifies the allocation of equity stakes between JV participants (Rosneft – 45%, Pertamina – 55%), JV management and joint activity funding principles, and further steps for the project implementation.
The parties are currently developing a feasibility study (FS) of the project. The final investment decision on the project will be made upon the results of the feasibility study, basic engineering design (BED) and front end engineering design (FEED).
Additionally, the Joint Venture Agreement describes key terms of hydrocarbons supplies by Rosneft to the JV, and the principles of marketing the products to be produced at JV facilities.
The establishment of the Joint Venture marks a new phase in the development of a modern refining and petrochemical complex in Indonesia. The project is an important part of Rosneft strategy aimed at achieving a stronger presence in the oil products market of the Asia-Pacific Region.
Rosneft and Pertamina laid the foundation for cooperation in the area of joint development of offshore fields. The companies signed a Memorandum of understanding for cooperation in respect of the Northern Tip of Chayvo Field (Sakhalin Island).
Pursuant to the signed document, the parties intend to agree legally binding documents for the acquisition by Pertamina of up to a 20% share stake in the project. ■