PT Pertamina (Persero) said it expects to complete the first phase of its previously announced project to upgrade and modernize the 260,000-b/d refinery in Balikpapan, East Kalimantan, Indonesia, in 2020.
Following the start of construction by PT Pembangunan Perumahan (Persero) Tbk on employee housing at the site in 2016, Pertamina, through its contractor PT Wijaya Karya (Persero) Tbk, is now in the process of further developing the site and expanding dock capacity for the two-phased Balikpapan Refining Development Master Plan (RDMP) project, the operator said.
Previously due to be completed in 2019, Balikpapan’s RDMP Phase 1—which will increase the refinery’s crude processing capacity to 360,000 b/d from 260,000 b/d as well as enable production of fuels that conform to Euro 2-quality specifications—currently is scheduled for completion in February 2020, said Rachmad Hardadi, Pertamina’s director of refining and petrochemicals.
Designed to equip the refinery to produce Euro 5-quality fuels, Balikpapan’s RDMP Phase 2 will wrap sometime soon after RDMP Phase 1 is completed, said Hardadi, without disclosing further details.
Earlier in the year, Pertamina let contracts to Honeywell UOP LLC, a subsidiary of Honeywell International Inc., to provide technology licensing and engineering design both for a new 33,000-b/d continuous catalyst regeneration (CCR) unit as well as an expansion involving a 47,000-b/d hydrocracking unit as part of Balikpapan’s RDMP (OGJ Online, Feb. 2, 2017).
In 2016, the operator let a series of contracts to Axens SA and CB&I to provide technology licensing, design, and engineering on additional grassroots units to be added during the Balikpapan modernization (OGJ Online, Oct. 6, 2016; July 25, 2016).
The Balikpapan RDMP project comes as part of the Pertamina’s broader 10-year, multibillion-dollar plan to revitalize operational capability of its Indonesian refineries by equipping them with enough flexible processing capacity to meet the country’s growing demand for cleaner petroleum-derived products and reduce its dependence on foreign imports (OGJ Online, Dec. 15, 2014; Oct. 7, 2013).
RDMP
First announced in 2013, Pertamina’s refinery revitalization program’s RDMP specifically aims to upgrade the aging Balikpapan, 348,000-b/d Cilacap, 170,000-b/d Dumai, and 125,000-b/d Balongan refineries to:
• Process heavier, less-expensive crudes with a 2% sulfur content than the lighter, sweet crudes (0.4% sulfur content) they were originally configured to process.
• Increase the overall Nelson Complexity Index factor of the operator’s refining system to 8.9 from its current 5.4.
• Improve the volume and quality of fuel production to conform with Euro 4 and Euro 5 standards.
• Increase system-wide refinery profitability to $7.90/bbl from $3/bbl (OGJ Online, May 23, 2016).
Still on schedule to be fully completed by 2025, RDMP will increase Indonesian crude processing capacity to 2 million b/d from its current capacity of about 820,000 b/d, Pertamina said.
Greenfield projects
Alongside revitalization projects at its existing refineries, Pertamina said it also plans to build two grassroots integrated refining and petrochemical complexes, each of which will cost $10 billion to complete, the company said in a report to investors.
The first project, a joint-venture with Russia’s OJSC Rosneft, to be built at Tuban, in East Java, would involve construction of a 300,000-b/sd refinery configured to process imported volumes Russian ESPO and Iraqi Basrah, as well as other medium to heavy, sulfurous crude imports to produce feedstock for an associated petrochemical complex, according to the partners (OGJ Online, May 27, 2016).
The Tuban refinery is currently due to be completed in 2020, with the integrated petrochemical plant targeted for completion in 2024, Pertamina said.
Independently, Pertamina is evaluating construction of a new 300,000-b/sd in Bontang, East Kalimantan, that also would be integrated with some type of still-yet-to-be-identified petrochemical operation.
Upon completing all RDMP and grassroots integrated projects as currently planned, Pertamina said it expects to raise its total fuel production capacity to 2.3 million b/d by 2025.
Contact Robert Brelsford at [email protected].