OREANDA-NEWS. May 27, 2016. Rosneft and Pertamina signed a framework agreement on cooperation.

The Parties have agreed to perform a bankable feasibility study to finance the project of construction of the new refining and petrochemical complex Tuban in the eastern part of Jawa, Indonesia and establish a joint venture for the project implementation.

Earlier Rosneft led the competition for a share in the Tuban complex, launched by Pertamina. The final investment decision will be taken upon the results of the feasibility study, basic engineering design (BED) and front-end engineering design (FEED).

Also, the signed agreement envisages a study into the prospects for joint projects in the area of crude and oil products supplies, logistics and infrastructure, the potential for Pertamina to enter in Rosneft's Upstream projects in Russia as an equity holder, and partnership in international joint projects for oil refining.

Indonesia is one of the most promising and rapidly growing economies of the region. The country is a net importer of motor fuels and petrochemicals. Implementation of the conditions of the signed agreement will enable Rosneft to expand its footprint on the Indonesian energy market and strengthen the status of the Russian Company as a reliable partner in oil and gas production and refining projects in the Asia-Pacific Region, as well as form a basis for development of upstream and downstream new joint projects in Russia and third countries.

Following the signing of the document, Rosneft Chairman of the Management Board Igor Sechin noted: "We welcome the signing of the agreement. The geographical location of Indonesia, at a crossroad between two oceans, the Pacific and Indian, opens for the country the way for turning into a global transportation and energy hub which could become a critical point for global economic growth. It is obvious that accomplishment of such a global task cannot be achieved without ensuring stable development of the national economy and its uninterrupted supply with energy and fuel resources. In this regard the establishment of partnership relations with Pertamina is the logical development of expanding Rosneft activities in the Asia-Pacific Region".

Note for editors:

The design capacity of primary processing at the Tuban complex is 15 mln tons/year. It will run on imported medium and heavy grades of sulphurous 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 tons.

Indonesia is the largest APR country. The population exceeds 254 mln people (according to the Oxford Economics data for 2014). In 2015 the Indonesia GDP grew up by 4.79%.

Rosneft has a proven experience in implementing oil refining and petrochemical projects outside Russia. The Company participates in joint ventures in this area in Germany, Italy, and Belarus. The oil refining throughput outside Russia in the Rosneft share for 2015 amounted to 12.2 mln tons. In Q1 2016 Rosneft's petroleum product output outside Russia equaled 3.26 mln tons (+25.8% year-on-year).