Coordinating Minister, Luhut Shows Appreciation towards the Success of PLBC and TKDN RDMP Cilacap

Jakarta, July 21, 2020 - After completing the Langit Biru Cilacap Project (PLBC) with a Domestic Component Level (TKDN) of 41.52%, Pertamina will continue to commit in increasing the TKDN in the Cilacap Refinery Development Master Plan (RDMP) project by up to 50%. It confirms Pertamina's commitment to continue to be a driver of the national economy.

Previously, from the total Capex of the PLBC project valued at USD 392 million and the absorption of 3,000 workers, Pertamina succeeded in implementing the TKDN above the previously set target of 30%.

Currently, Pertamina continues to encourage the implementation of the TKDN in RDMP Cilacap with a minimum target of 40% to a maximum of 50% from the total investment of USD 5.8 billion and absorption of 20,000 workers at the peak of construction and 500-800 people during operations. With the high application of TKDN, it is expected to have a multiplier effect on GDP of USD 2 billion.

This was said by the President Director of PT Pertamina (Persero), Nicke Widyawati, to the Coordinating Minister for Maritime and Investment, Luhut Binsar Panjaitan, while reviewing Pertamina's RDMP project in Cilacap, Tuesday (21/7).

Luhut appreciates the implementation of the TKDN by Pertamina because it is in line with President Joko Widodo's direction which always emphasizes on the maximization of the use of domestic products, including in the management of new and renewable energy.

"Everything that can be made domestically should be made domestically. That is the Indonesia that we can call as the new normal era," Luhut said.

The visit to the Pertamina RDMP Cilacap Refinery was also attended by the Minister of Energy and Mineral Resources (ESDM), Arifin Tasrif, Minister of Maritime and Fisheries, Edhy Prabowo, Director General of Cipta Karya of the Ministry of Public Works and Housing, Danis Hidayat, President Director of Pertamina, and Central Java Deputy Governor Taj Yasin Maemoen.

Along with the visit to the RDMP Cilacap, Luhut also reviewed PLBC, which has been integrated with the Cilacap Refinery. According to him, since the operation of PLBC, the production of Pertamax RON 92 in the Cilacap Refinery increased significantly to 1.6 million barrels per month from the previous 1 million barrels.

Luhut also appreciated Pertamina again for the completion of PLBC in 2019 and better TKDN progress. He hopes that in the future, the scope will be wider, not only in civil development but also in other components in infrastructure development.

In the last 3 years, explained Nicke, TKDN in the Pertamina project has continued to increase. According to the BPKP audit results of 2018, Pertamina TKDN reached 38.17% and increased to 43.16% in 2019. While following the prognosis for the 1st quarter 2020, Pertamina TKDN reached 52.20%.

Nicke added, as of July 12, 2020, the progress Pertamina recorded of the Cilacap RDMP project in the early work reaches 25.59%. There were several jobs in zone one, including Cut Soil, Temp Drainage, and Road Access, CCSP Installation, Soil Fill, Clearing, Grubbing, Soil Disposal, and zone two Clearing the laydown fence location.

At RDMP Cilacap, a New Diesel Hydrotreating Unit (DHT) will also be built, which will produce Euro 5 Standard Diesel. Currently, DHT work is in the prebid stage for the selection of Licensor, which is targeted to start from the Basic Engineering Design package (BEDP).

"The DHT facility in the RDMP Cilacap will increase diesel production from 348 thousand bpsd to 400 thousand bpsd with the international Euro 5 standard. It will complement Pertamina's achievements in PLBC in which it is capable of producing environmentally friendly gasoline products with Euro 4 standard," Nicke said.

The operation of PLBC has also reduced the import of High Octane Mogas Component (HOMC) as a component of blending gasoline products significantly. Therefore, it has a positive impact on efforts to reduce fuel imports and succeed in saving the country's foreign exchange to Rp.10 trillion per year.

Back on the topic of TKDN, Nicke said, overall, the TKDN in the RDMP and GRR megaprojects was targeted to reach 30-70 percent. RDMP Balikpapan & Lawe-Lawe, for example, the TKDN is targeted to reach 30-35%, Balongan RDMP phase 1 TKDN reaches 70%, Balongan Phase 2 TKDN is 50-60%, Dumai RDMP TKDN reaches 40-50 and GRR Tuban TKDN reach 40-50%.

"For the commitment to use local content, Pertamina will have a function that focuses on handling TKDN Pertamina Group from upstream to downstream and will assess each project's TKDN from the planning phase to ongoing project monitoring," concluded Nicke. **