The government of Indonesia advocates for the construction of the Tuban refinery, as residents in the East Java region strongly object to the project and have delayed the land acquisition process and the start of construction.
The 300,000 bbl/d (15 Mt/year) Tuban refinery project was announced in October 2016, when Pertamina signed a joint-venture agreement with Russian oil group Rosneft. The US$15bn project was initially expected to be commissioned in 2021, but financial issues disclosed in June 2017 made the company delay the commissioning to 2024.
Financial issues also prompted Pertamina to delay the expansion of its 260,000 bbl/d Balikpapan refinery to 360,000 bbl/d by one year, from 2019 to 2020, and to postpone the second phase of the project (fuel quality improvement) to 2021. The completion of the US$5bn upgrade of the 348,000 bbl/d Cilacap refinery in Central Java - an upgrade programme jointly led with Saudi Aramco - was delayed by two years, from 2021 to 2023.
The construction and upgrade of refineries is part of Pertamina’s plan to more than double domestic oil product production, from 1 mbl/d in 2017 to 2.3 mbl/d by 2025.