Confirmed! Pertamina and Chandra Asri Sign Cooperation Agreement on National Petrochemical Business Development
Jakarta, August 25, 2020 - PT Pertamina (Persero) through PT Kilang Pertamina Internasional (KPI) signed an agreement with PT Chandra Asri Petrochemical Tbk through the Head of Agreement (HoA) regarding petrochemical business cooperation in Indonesia. It is hoped that this cooperation can reduce petrochemical imports and develop the domestic petrochemical business.
The HoA signing between Pertamina and Chandra Asri Petrochemical took place at the Main Building of PT Pertamina, Jl. Medan Merdeka Timur No 1 A, Central Jakarta, Tuesday (25/8/2020), which is also broadcasted online. The HoA signing was carried out by the President Director of PT KPI, Ignatius Tallulembang, and the President Director of PT Chandra Asri Petrochemical, Erwin Ciputra.
President Director of Pertamina, Nicke Widyawati, said the signing was related to the commitment for a joint study in the synergy of petrochemical projects between the two companies. The purpose of this HoA is to meet domestic petrochemical needs, which are currently still imported in a high amount (deficit). Therefore, the domestic petrochemical business opportunity is considered very potential to be developed.
"In 2019, at that time, we conducted a general assessment to see the potential for cooperation, see opportunities for petrochemical development in order to reduce imports. This is following the President's direction and government policies to encourage the construction of factories that produce import substitution," said Nicke.
Nicke added that petrochemical is one of the long-term business development and mitigation. Nicke said petrochemicals would be the future business for the two companies.
"Currently, Pertamina also produces several products which are used as raw material for petrochemicals. So it is considered appropriate for petrochemicals to be a downstream product of Pertamina's refineries. In Pertamina's RJPP until 2026, Pertamina will build a petrochemical plant that will be integrated with Pertamina's refineries. It is the right time to work together because the common goal is how to fight dependence on imports. Therefore, all parties need to work together so that Indonesia can be more independent," she said.
Nicke emphasized that Pertamina is ready to work together with Chandra Asri to develop a petrochemical refinery. Moreover, Pertamina already has an upgraded refinery with petrochemical-based capabilities. "We have the Balikpapan, Balongan, Cilacap, Dumai RDMP. We will upgrade and increase upstream and downstream cooperation. So that petrochemical products in Indonesia can be competitive and enter and be leading in Asia is our task together," she said.
"Hopefully, what we sign today will be a blessing for the Indonesian people and us. What we are going to do is not just a business, but the responsibility of the nation and state to free dependence on imports," added Nicke.
Meanwhile, Commissioner of PT Chandra Asri Petrochemical Tbk, Agus Salim Pengestu, said he was happy with the cooperation with Pertamina in the petrochemical business. With this cooperation, it is hoped that the petrochemical industry in Indonesia will be more developed.
"After this, we can start a feasibility study. In addition, there are many opportunities to explore the domestic and Asian petrochemical business. We believe that the potential for cooperation between the two parties is still wide open. The projects in the HoA are only the first steps, let us try to reach an agreement and work together for the progress of this beloved country," said Agus Salim.
Previously, Pertamina and Chandra Asri Petrochemical had signed a memorandum of understanding (MoU) on October 1, 2019, to establish a national petrochemical business synergy. It is based on the high demand for petrochemicals in the country, which is currently still imported in high (deficit) quantities. **