Pertamina Prepares More Than USD 10 Billion in Capex for High Growth in 2021, Proving to be Adaptive in Facing Pandemic Challenges

Jakarta, April 12, 2021 - Throughout 2020, PT Pertamina (Persero) has made various efforts to face the pandemic's challenges, such as a decline in fuel demand, world oil prices, and the Rupiah exchange rate. Pertamina strives to adaptive through the consistent implementation of transformation, efficiency, and accountability. Therefore, Pertamina can maintain smooth operations, including carrying out Government assignments and maintaining positive financial performance at the end of the year.

"A lot has been carried out, and Pertamina will continue to adapt. With good fundamentals, in 2021, Pertamina will immediately accelerate its operational performance to achieve high growth targets of more than 20%," said Senior Vice President of Corporate Communication & Investor Relations of Pertamina, Agus Suprijanto.

To achieve this target, Pertamina has set the company's capital expenditure budget (Capital Expenditure/Capex) to reach USD 10.7 billion in 2021 or double the prognosis for Capex's realization last year, valued at USD 4.7 billion.

Agus explained, of the total USD 10.7 billion, 46% of the share would be dedicated to upstream oil and gas activities to ensure increased production and oil and gas reserves. Therefore, it could have an impact on reducing national crude oil imports. The other 36% will be allocated to continue developing refineries & petrochemicals, while 18% will be absorbed for other business activities, including continuing the development of new and renewable energy.

"The budget shows Pertamina's high optimism to continue to grow and rise amid the Covid 19 pandemic by continuing projects or business development that have been running since the previous year and at the same time creating new initiative programs," said Agus.

According to Agus, with this Capex, it is certain that the operational work plan in 2021 can run well, including achieving the oil and gas production target from Pertamina's fields at home and abroad. The addition of oil and gas reserves is also targeted to reach 696 MMBOE, or almost four times the target of adding reserves last year.

Pertamina conducted a 2D marine seismic survey of more than 31 thousand kilometers last year to find potential oil and gas reserves, making it the longest seismic survey in Asia and Australia in the last ten years.

"We will continue to carry out seismic survey activities to obtain potential new oil and gas reserves so that in the future, the ratio of oil and gas reserves to production will increase (Reserve to Production Ratio)," said Agus.

In fulfilling national energy, Pertamina continues to boost processing activities, especially the production of higher quality and more environmentally friendly fuel. The Langit Biru refinery, which has been operating for more than one year, has proven to increase the production of Pertamax fuel, thereby reducing imports by up to USD700 million per year. Therefore, Pertamina consistently continues to build refineries through the RDMP and GRR projects while also completing green refineries and the petrochemical industry in several refineries.

"In the downstream sector, Pertamina targets the fuel sales volume to increase by 12% from last year. In addition to focusing on 76 One Price Fuel assignment in 3T areas, Pertamina will realize 10,000 Pertashops and LPG Outlets in 66,691 villages/wards. It is all to ensure that energy is channeled to all corners of the country," said Agus.

Meanwhile, gas distribution is targeted to reach 392 thousand BBTU and gas transmission of 502 BSCF by constructing a gas pipeline network, including gas infrastructure for 500 thousand household connections.

For the development of clean energy towards a future energy transition, in 2021, Pertamina targets electricity production of 4.5 thousand GWh through the development of Geothermal Power Plants (PLTP), Solar Power Plants (PLTS), and Biogas Power Plants (PLTBg). Pertamina also continues its role in the Electric Vehicle battery ecosystem and DME development.

"Even though the pandemic will continue to pose serious challenges in 2021, with this Capex, Pertamina will support the use of TKDN, labor absorption, and other sectors that ultimately drive the Indonesian economy," Agus concluded.**