Nigeria to invest Rp 24t in Indonesian refinery deal

The Jakarta Post, Wed, 10/12/2011

Nigeria plans to invest Rp 24 trillion (US$2.68 billion) in Indonesia to fund the construction of three oil refineries, an official says.

The Industry Ministry's director general for manufacturing-based industry, Panggah Susanto, was quoted by kompas.com as saying that both countries had agreed to build the refineries in Indonesia.

Nigeria, which produces 2.6 million barrels of oil per day (bpd), was looking for a partner to refine its crude oil, Panggah said.

"Previously they wanted the refineries to be built in Nigeria," he said Tuesday. "However, as Indonesia is currently improving its downstream industry, Indonesia wanted the refineries to be built here instead."

The refineries, which are projected to produce 300 bpd each, will be used to process crude oil from Nigeria.

"State firm PT Pertamina will buy the crude oil from Nigeria and process it here," he said.

TEI falls short of expectations

Mustaqim Adamrah, The Jakarta Post, Jakarta 

The recent 23rd Trade Expo Indonesia (TEI) recorded a total of US$214.17 million in transactions, a slight rise from the $208.26 million recorded at last year's event. 

But despite the increase, the figure was less than projected. 

"The bad news is we missed the target of $220 million because global demand is declining," Trade Minister Mari Elka Pangestu said. 

"But the good news is we were still able to record growth." 

Mari said a slowdown in Indonesia's "traditional markets", such as the United States and members of the European Union, partly contributed to the shortfall. 

For example, the value of transactions with Spanish businesses sharply declined from $23.91 million in 2007 to $2.07 million. 

Orders from Australian businesses also were down dramatically, from $13.71 million to $2.24 million. 

Orders from Japanese businesses fell from $11.26 million last year to $6.49 million, while transactions from Taiwan dropped from $9.88 million to $5.2 million. 

Despite missing the target, the TEI did manage to attract buyers from new markets, Mari said. 

Orders from new players accounted for $148 million of the total, including orders from Egypt ($28.47 million), Bulgaria ($12.25 million), Saudi Arabia ($6.26 million), Sudan ($4.65 million), Nigeria ($4.33 million), Pakistan ($4.32 million), Ukraine ($4.28 million), South Africa ($3.16 million) and Brazil ($3.14 million). 

"We'll now focus on emerging markets, like China and India, as well as on new markets, such as Turkey, Egypt, Iraq, Iran, Uzbekistan, Ukraine, Kazakhtan and Russia," Mari said. 

Indonesia is also trying to benefit from an expected drop in China's share of the international market as it is "losing its competitiveness in the manufacturing sector with the strengthening of the yuan against the U.S. dollar".