The PT Pertamina Rosneft Pengolahan dan Petrokimia joint venture (JV) has signed a contract with Tecnicas Reunidas to design a refinery in Tuban.

Under the contract, Tecnicas Reunidas will carry out the basic engineering design (BED) and front-end engineering design (FEED) for the construction of the Tuban grass root refinery and petrochemical complex (TGRR) in East Java, Indonesia.

The JV comprises Rosneft and Indonesian company Pertamina. The former owns a 45% stake in the JV, which was established according to an agreement signed in October 2016, while the remaining interest is held by Pertamina.

In May 2016, Rosneft and Pertamina signed an agreement to finance the construction of the refining and petrochemical complex worth up to $13bn. The companies agreed to establish a JV to implement the project.

The design capacity of primary processing at the Tuban complex is expected to be 15 million tonnes per year (Mtpa).

Medium and heavy sulphur crude oil grades will be the feedstock for TGRR. The crude oil terminal will be capable of accommodating VLCCs of up to 300 thousand tonnes.

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The Tuban project is fully supported by Indonesian authorities, both in terms of the benefits, as well as the provision of the infrastructure.

Rosneft noted that the integrated refinery and petrochemical complex is expected to be commissioned within the next five years.

The project is being built as part of Rosneft’s strategy to enhance its footprint in the high-margin market as a petroleum-based product developer in the Asia-Pacific Region.

It will enable the company to be embarked as a reliable oil and gas production and refining partner in Indonesia.