TPPI Shuts Petrochemical Plant as Agreement Ends With Pertamina

PT Trans Pacific Petrochemical Indotama has stopped production at its Tuban plant in East Java after an agreement with Indonesia’s state oil company ended.

The subsidiary of Tuban Petrochemical Industries is negotiating with PT Pertamina, overseas suppliers and the country’s upstream oil and gas regulator for condensate feedstock to restart the plant in July or August, Basya Himawan, the company’s vice president, said in a phone interview yesterday. The company known as TPPI can process 100,000 barrels a day at its Tuban unit in East Java, which turns condensate into products including naphtha.

“We want to start operating independently,” Himawan said. “We are looking for financing and feedstock suppliers as well as to sell output by ourselves.”

TPPI restarted the plant in November after a nearly two-year suspension under the deal with Pertamina that ended May 21. TPPI bought all of its condensate from Pertamina in exchange for selling its output to the state-owned company.

TPPI is looking to buy at least 1 million barrels a month of condensate to restart the plant, Himawan said. The company has processed both domestic and imported supplies, including from the Middle East and Australia, he said.

The plant can produce 500,000 metric tons of paraxylene, 120,000 tons of orthoxylene and 200,000 tons of benzene annually, according to Himawan. Paraxylene is used to make synthetic fibers and plastics. Benzene and orthoxylene are found in car additives, solvents and dyes.

To contact the reporter on this story: Fitri Wulandari in Jakarta at fwulandari@bloomberg.net

To contact the editors responsible for this story: Pratish Narayanan at pnarayanan9@bloomberg.net Mike Anderson, Ramsey Al-Rikabi

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