Indonesia, Iran in refinery venture

JAKARTA, March 12 (UPI) -- Indonesian oil company PT Pertamina signed a joint venture shareholder agreement with firms from Iran and Malaysia to build a $6 billion oil refinery plant.

Within two weeks of the signing, the three parties including National Iranian Oil Refining and Distribution Co., Pertamina and Petrofield Refining Company of Malaysia will establish a joint venture company in Indonesia which is expected to begin the project immediately, Xinhua reported.

If things proceed as expected, the refinery plant will be ready by 2012 and Pertamina and NIORDC will each have a 40 percent stake in the new company and Petrofield will hold the other 20 percent.

During the first phase, the refinery is expected to run at 150,000 barrels of crude oil per day but Pertamina and its partners are planning to eventually expand refinery capacity to 300,000 barrels per day.

"Iran is committed to supplying half of the crude oil needs of the refinery, in other words, 150,000 barrels per day," NIORDC President Mohammad Reza Nematzadeh said.

Currently, because of limitations in domestic refinery capacity, Indonesia imports about 400,000 barrels of crude oil equivalent a day.