Fulfill National Strategy Projects Power, Pertamina Rosneft Collaborates with PLN in Providing Electricity for The Construction of the Tuban GRR
Denpasar, September 24, 2021 – In line with the Nawacita (nine-point development programs) of the President of the Republic of Indonesia to Create Economic Independence by Strengthening Domestic Economy Strategic Sectors and following the national energy grand strategy goals, Pertamina is currently running a series of mega-scale Refinery and Petrochemical Projects.
Through series of projects, Pertamina is expected to reduce Indonesia’s dependence on petroleum products imports. It is by increasing refinery capacity to optimize fuel products and improve the quality of fuel and naphtha. It is also to advance the Indonesian economy by massively expanding the business into the petrochemical industry, which is currently still very much dependent on imports.
Tuban Grass Root Refinery (GRR) is one of the mega projects currently in Pertamina’s concern. The oil refinery construction integrated with the Petrochemical area with a crude oil processing capacity of 300 thousand barrels per day will produce fuel of 230 thousand barrels per day in total and petrochemical and aromatic products of 4.1 million tons per year.
As the efforts to accelerate the progress of Tuban GRR construction, Pertamina, through its subholding Refining & Petrochemical subsidiary, PT Kilang Pertamina Internasional, is also trying to ensure the availability of facilities and infrastructure. It is to support the operation of the Tuban GRR refinery, which is planned to start operating in 2027 under the management of Pertamina Rosneft.
Cooperation between SOEs is needed to ensure the electricity supply and to support the operation of the Tuban GRR refinery in the future. SOEs synergy was manifested through the Memorandum of Understanding (MoU) between Pertamina Rosneft and PT PLN (Persero) regarding a joint study plan of the electricity supply for the Tuban GRR project needs. The MoU was signed directly by Kadek Ambara Jaya (Pertamina Rosneft President Director), Pavel Vagero (Finance and General Director), and Adi Priyanto (General Manager of PLN Java Distribution Unit) on Thursday (23/09) witnessed by Pahala Mansury (Vice Minister of SOE I).
In his remarks, Mansury said that the electricity provision for the Tuban New GRR will provide benefits for both parties. In addition, SOEs synergy will provide benefits related to national efficiency. “For PLN, this collaboration will increase the electricity absorption so that it will increase revenue, while for Pertamina Rosneft, this collaboration will focus on increasing its competitiveness,” he added.
Through this MoU, Pertamina Rosneft and PLN will open the opportunity to conduct a joint study to ensure the electricity supply of up to 20 Megawatts (MW) during the construction and commissioning phases. In addition, from the study results, the most optimal and profitable cooperation scheme will be determined from the business aspect. It will include determining the provision of supporting infrastructure, system configuration scenarios, and equipment.
“The construction phase is targeted to start in the third quarter of 2023, and the estimated electricity demand for Tuban GRR in this phase is 20 megawatts. Meanwhile, the commissioning start-up utility, which will begin in the second quarter of 2026, can reach electricity demand of 50 megawatts,” said the President Director of PT Pertamina International Refinery, Djoko Priyono, on behalf of Pertamina’s President Director, Nicke Widyawati.
He further stated that the current configuration of the Pertamina Rosneft Refinery requires assurance of refinery operations without electricity supply interruption, so a reliable electricity supply is needed. “The absent of refinery operations in a day will lead to the loss of potential revenue of USD34 million (equivalent to IDR480 billion) so that a reliable continuous supply of electrical energy is needed with Zero Total Failure,” said Djoko.
On this occasion, the President Director of PT PLN (Persero), Zulkifli Zaini, expressed his appreciation for the trust given to PLN, which will maintain its commitment to supply electricity needs reliably at competitive prices.
This MoU will be valid for 1 (one) year. The results of this joint study will be stated in the Tuban GRR electricity supply cooperation in an Electricity Sale and Purchase Agreement. At the operating stage, the total electricity demand for normal operating conditions reaches 678 megawatts through the configuration of self-power generation supply from the Tuban GRR refinery and the electrical power grid from PLN combination, and it is planned that PLN will supply up to 500 megawatts.
The collaboration between Pertamina Group and PLN is not the first, especially for the operation of the fuel refinery. Previously, PT Pertamina (Persero) signed a cooperation agreement with PLN to provide electricity services for five Pertamina refineries at Refinery Unit (RU) II Dumai, RU III Plaju-Sungai Gerong, RU IV Cilacap, RU V Balikpapan, and RU VI Balongan with the needs the total electrical power supplied reaches 217 MVA which can further increase to 104 MVA.
Pertamina Rosneft is a joint venture between the Pertamina Group and the giant Russian oil company, Rosneft, implementing the Tuban GRR national strategic project. It is built in an area of 834 hectares. The refinery, which is expected to be the largest petrochemical facility in Southeast Asia, is targeted to operate in 2027 and absorb approximately 27,000 workers during construction and 2,500 workers after the project operates. The Tuban GRR project is currently at the Front-end Engineering Design stage with progress as of September 17, 2021, reaching 34.54% from the plan of 17.83% (ahead +16.71%).
With support from the Ministry of SOEs, the Ministry of Energy and Mineral Resources, and also PLN, the execution of the Tuban GRR project can run smoothly and following the target, which will lead Indonesia to become an independent nation in fulfilling fuel and petrochemical products.**