Indonesia's OSO Group plans to establish a joint venture with the State Oil Company of Azerbaijan (SOCAR) to build an oil refinery, Reuters reported with the reference to the OSO Group CEO Mariano Asril.
"We are going to refine the oil from Azerbaijan. The purpose is to trade or sell the processed oil to Indonesia or any other Asia-Pacific country," Asril said.
The estimated cost of the oil refinery, which is expected to process 600,000 barrels per day (bpd), is $4.8 billion . The refinery is scheduled to be launched in 2017. It would be located on part of OSO's concession in a free trade zone next to Batam island.
According to Asril, both sides will invest in construction of the oil refinery, however the most part of funding will come from Azerbaijani side. OSO Group from its part will provide them with all the facilities, the permit and the land.
Asril said that a memorandum of understanding with SOCAR is expected to be signed in November.
SOCAR carries out oil trade in various regions of the world under the banner of SOCAR Trading.
The company has made its office in Singapore fully responsible for the development of trade with crude oil in Asia, including increasing its market share at the expense of long-term contracts.