Riyadh – Mubasher: The Saudi Arabian Oil Company (Saudi Aramco) and Indonesian state energy company Pertamina agreed upon extending negotiations regarding the potential joint development of Cilacap Refinery in the country by another three months.

Both parties reached this agreement on the sidelines of the G20 meeting in Japan, according to Pertamina’s statement on Tuesday.

The two companies agreed to jointly involve reputable financial advisors in order to finalise the valuation and cooperation scheme, making the agreement beneficial for both parties.

"We welcome this agreement, hopefully, it will become a win-win solution that can be accepted by both parties and accelerate the start of the development of the Cilacap Refinery," Pertamina's spokeswoman Fajriyah Usman said.

She noted that the Joint Venture Development Agreement between Pertamina and Saudi Aramco is currently underway and is due to end at the end of June 2019.

"Thus, the valuation and cooperation scheme between Pertamina and Aramco for the Cilacap refinery must be completed in the next 3 months," Usman added.

Earlier in April, Pertamina’s officials revealed that if talks with Aramco failed, the Indonesian company would launch the project without a partner to meet an operational target of 2025.

In 2016, Aramco and Pertamina agreed to negotiate to form a joint venture to build and operate the Cilacap refinery in the province of Central Java.

It is worth noting that the development of the Cilacap Refinery is part of the six Refinery Development Master Plan (RDMP) and New Grass Root Refinery (NGRR) projects to increase Pertamina's fuel production capacity from currently around 1 million barrels per day (bpd) to around 2 million bpd.

The six projects are Cilacap RDMP, Balikpapan RDMP, Balongan RDMP, RDMP Dumai, Tuban NGRR and Bontang NGRR.