Indonesian state-owned oil company PT Pertamina is to begin construction of a new refinery in collaboration with its Iranian counterpart, it has been announced.

According to a statement released by Pertamina director Ari Soemarno, a preliminary study for the new facility, which is to be located in Bojanegara, Banten, will be completed by October at the latest.

The firm's processing director Rukmi Hadihartini also confirmed that, once this study is completed, the engineering process will begin straight away, with the refinery anticipated to have a capacity of around 300,000 barrels of oil per day.

It is also believed that Pertamina is looking into the possibility of building a similar refinery in Tuban, East Java, though with Libyan cooperation, as the country moves to increase its production capacity and reduce its reliance on imports.

Earlier this month, it was reported that the Indonesian national producer plans to raise the cost of its liquefied natural gas (LNG) products by as much as 50 per cent when it renews its contracts with its Japanese clients within the next two or three years.

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