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Pertamina Pushes Exports of Petrochemical Products

SharePertamina pushes exports of petrochemical products. State energy holding company Pertamina aims to further boost its exports of petrochemical products by tapping...

Written by Erwin Prasetyo · 2 min read >
Petrochemical Products

Pertamina pushes exports of petrochemical products. State energy holding company Pertamina aims to further boost its exports of petrochemical products by tapping into the drilling mud business, the global market of which is projected to become worth more than US$10 billion within the next six years.

Petrochemical Products
An attendant walks through a Pertamina gas station in Kuningan, South Jakarta. Pertamina on Thursday exported its maiden shipment of drilling mud to Algeria. Pertamina pushes exports of petrochemical products (The Jakarta Post/Seto)

A consulting firm based in India and the United States, Grand View Research, has said the revival of bidding for new exploration and production (E&P) projects in the years to come would spur the growth of the market for drilling mud, aka drilling fluid. The company estimates that the world market for drilling mud would be worth $10.12 billion by 2025.

In the Asia-Pacific region alone, sales are projected to reach $1.5 billion by 2025 owing to growing E&P activities in countries such as China and Indonesia, the company said.

On Thursday, Pertamina exported it maiden shipment of 4,000 barrels of drilling mud called Smooth Fluid-05 (SF-05) to its upstream subsidiary in Algeria, Pertamina Algeria EP (PAEP).

The shipment departed from the firm’s refinery in Balikpapan, East Kalimantan, which currently has a refining capacity to produce 1.8 million barrels of SF-05 per year.

Pertamina corporate marketing director Basuki Trikora Putra said during a ceremony to mark the event on Thursday that the export value of the mud was more than Rp10 billion (US$708,802). “It might be small in terms of value, but every big thing must start small, right? This is proof that our synergy among the subsidiaries is working,” he said.

The export, according to the company’s written  statement, was jointly arranged by two of Pertamina’s subsidiaries, namely Pertamina Lubricants and Petrochemical Trading.

“This maiden export is a milestone for our SF-05 product,“ Basuki, said, adding that Pertamina also wanted to export the drilling mud to other countries.

SF-05 is an adaptable base oil used to lubricate oil drilling. It is to replace the customary oil-based fluids as SF-05 is a synthetic fluid, claimed to be more efficient.

Denie S. Tampubolon, the president director of Pertamina International EP (PIEP), which is the parent company of PAEP, told the press that the SF-05 would first be used in two of PAEP’s oil wells.

“We want to try it first in our two wells and then gradually use it in other wells,” he said referring to PAEP’s Well 10 and Well 11 in the Menzel Lejmet North (MLN) Block.

After being tested in the two wells, the SF-05 is to also be used in 12 to 20 of PAEP’s wells, resulting in a total demand for 32,000 barrels, according to the statement.

PAEP is also partially owned by Spanish energy firm Repsol and Algeria’s state-owned Sonatrach. Currently, PAEP operates 67 oil wells in Algeria with a current production capacity of 20,000 barrels per day.

Denie of PIEP explained that SF-05 has an advantage over diesel-based drilling mud in terms of clean emissions and he claimed that the price of SF-05 was also more competitive, even after including logistics costs.

“We have calculated the economic cost [of SF-05], but we can’t disclose it yet. However, I can say that the calculation showed that our product is a competitive one,” he said.

Pertamina said that SF-05 has passed a series of tests to gauge its biodegradability, its effect on sea creatures and whether it irritates skin and eyes.

Although this was the first time Indonesia has exported SF-05, the company has domestically sold between 60,000 and 100,000 barrels annually, Basuki of Pertamina said.

“All of our upstream subsidiaries have used it, but now we want to sell it to global oil contractors like in Africa,” he said.

Denie of PIEP explained that the synthetic SF-05 is suitable for oil fields that have a rich salt content like those in Algeria.

According to data, Pertamina has also exported lubricant products to 17 other countries, including Australia and China, through its Pertamina Lubricant subsidiary. Pertamina pushes exports of petrochemical products (Stefanno Reinard Sulaiman, The Jakarta Post)

 

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