OREANDA-NEWS. June 27, 2013. Taiwan has started importing Indonesian crude after a three-year hiatus, with state-owned refiner CPC inking a term contract to lift 500,000 barrels of Duri crude every three months for a year beginning in April with a second cargo expected in July, trading sources said.

Data released by the Bureau of Energy at Taiwan's Ministry of Economic Affairs this week showed that Taiwan imported 15,933 b/d of Indonesian crude in April, the first such import since 2010.

Meanwhile, data from Platts cFlow showed that CPC had fixed the Aframax tanker, Value, to load a crude cargo in Dumai on April 7 at a Worldscale rate of 70 points. Traders said this could likely have been the first cargo under the CPC term deal, but it could not be directly confirmed with CPC.

Platts cFlow data showed the vessel loaded on April 7 at Dumai and then arrived at the Taiwanese port of Kaohsiung on April 15.

CPC will likely be using the Duri crude for blending purposes, sources said. Duri crude has an API of 20.80 and is understood to be fuel oil-rich (76.75%). It also yields about 15.07% of gasoil and about 12.43% of kerosene.

Duri has limited use in refining and is chiefly used for direct burning and as a cutterstock for low sulfur waxy residue, traders said.

Prior to the April cargo, Taiwan imported between 1.3 million and 2 million barrels a year of Indonesian crude from 2007 to 2010, Taiwan's customs data showed.

Trading sources said Taiwan's interest in Duri crude could likely be because its price has eased considerably in recent years.

Platts data showed that Duri's premium to ICE Brent has eased from a high of USD10.43/barrel in June 2012 to a discount of around \\$6.40/b this week, on the back of tepid demand for direct burning crudes from North Asian end-users.

Duri's premiums, as with other burning crudes, trended higher in 2011 and 2012 following an increase in requirements from Japanese utilities in the aftermath of the March 2011 earthquake which shuttered its nuclear plants.