Meeting the energy challenge in the world's largest archipelago

28 Pages·2013·10.12 MB·English

by  Misako Iwase

Meeting the energy challenge in
the world's largest archipelago
Ardhy N Mokobombang
VP Strategic Planning & Business Development
Pertamina Refinery Directorate
JCCP International Symposium presentation
January 31, 2013
CONFIDENTIALANDPROPRIETARY
AnyuseofthismaterialwithoutspecificpermissionofPertaminaisstrictlyprohibited
Outline
▪
Potential of Indonesia
▪
Pertamina corporate vision 2025
▪
Pertamina refining vision 2025
▪
Challenges faced by Pertamina
▪
Pertamina refining strategy
– Upgrading of current refinery
– Building grass root refinery
PERTAMINA 1
Indonesia is the largest economy in Southeast Asia...
Share of GDP in ASEAN
Total GDP = USD 1848 billion; 2011
Myanmar
Indonesia
2%
Thailand
18%
Cambodia
1% 40%
14%
Malaysia
13% 6%
0% 1%
Brunei
6%
Singapore
Phillipines
Laos
Vietnam
SOURCE:McKinseyGlobalInstitute PERTAMINA 2
…with one of the fastest stable growth in the world
Overview of OECD and BRIC plus SouthAfrica
Percent
Real GDP growth 2000-10 GDP growth, standard deviation, annualised, 2000-10
China 11.5 Indonesia 0.9
India 7.7 Australia 0.9
Indonesia 5.2 Portugal 1.5
Russia 4.9 Norway 1.6
Slovakia 4.9 France 1.6
South korea 4.2 New Zealand 1.7
Turkey 4.0 Belgium 1.7
Poland 3.9 Switzerland 1.8
Estonia 3.8 Canada 1.8
Chile 3.7 India 1.8
Brazil 3.6 South Korea 2.0
South Africa 3.5 Poland 2.0
Czech Republic 3.4 China 2.0
Israel 3.1 Netherlands 2.1
Australia 3.1 United States 2.1
Average rest 1.7 Average rest 3.4
SOURCE:ConferenceBoardTotalEconomyDatabase;IMF;WorldBank;McKinseyGlobalInstituteanalysis PERTAMINA 3
In 2050 Indonesia’s GDP is projected to be higher than Germany and
France
2011 2030 2050
PPP GDPatPPP,2011, ProjectedGDPat ProjectedGDPat
rank Country $billion Country PPP,2011,$billion Country PPP,2011,$billion
1 U.S. 15,094 China 30,634 China 53,856
2 China 11,347 U.S. 23,376 U.S. 37,998
3 India 4,531 India 13,716 India 34,704
4 Japan 4,381 Japan 5,842 Brazil 8,825
5 Germany 3,221 Russia 5,308 Japan 8,065
6 Russia 3,031 Brazil 4,685 Russia 8,013
7 Brazil 2,305 Germany 4,118 Mexico 7,409
8 France 2,303 Mexico 3,662 Indonesia 6,345
9 U.K 2,287 U.K. 3,499 Germany 5,822
10 Italy 1,979 France 3,427 France 5,714
11 Mexico 1,761 Indonesia 2,912 U.K 5,598
12 Spain 1,512 Turkey 2,760 Turkey 5,032
13 SouthKorea 1,504 Italy 2,629 Nigeria 3,964
14 Canada 1,398 Korea 2,454 Italy 3,867
15 Turkey 1,243 Spain 2,327 Spain 3,612
16 Indonesia 1,131 Canada 2,148 Canada 3,549
17 Australia 893 SaudiArabia 1,582 SouthKorea 3,545
18 Poland 813 Australia 1,535 SaudiArabia 3,090
19 Argentia 720 Poland 1,415 Vietnam 2,715
20 SaudiArabia 686 Argentia 1,407 Argentia 2,620
SOURCE:Worldbankestimatesfor2011,PWCestimatesfor2030and2050 PERTAMINA 4
INDONESIAAND ITS POTENTIAL
Indonesia’s strong economic growth is expected to continue, driven by the
domestic consumer demand
An estimated 90 million Indonesians could join the
consuming class by 2030
Million people
280
265
240
145
180
Below
consuming 195
class
135
Consuming 85
45
class1
2010 2020 2030
Additional people in 40 90
the consuming class
1Consumingclassdefinedasindividuals withanannualnetincomeofabove3,000at2005purchasingpowerparity
2Basedon5-6%GDPgrowthscenario
SOURCE:McKinseyConsumerandShopperInsight(CSIIndonesia2011);2010PopulationCensus;
PERTAMINA 5
Indonesia’sCentralBureauofStatistics
Energy demand is expected to grow in line with the economic growth
2010
Growth2010-30
Indonesian primary energy demand 2030 Annual Share Share
Million tons of oil equivalent, annually growth 2010 2030
Oil 64 63 127 3% 35% 27%
Coal 30 152 181 9% 16% 39% ▪ Oil will continue to
be important energy
source in Indonesia
in 2030
Natural gas 33 59 91 5% 18% 20%
▪ The value of
Indonesia’s energy
Other res1 -2 53 51 0% 29% 11% marketcould
increasefrom about
$80 billion today to
8 around $210 billion
13% 0% 2%
Geothermal 8
1 in 2030
Biofuels/ 5
5 29% 0% 1%
biochemicals 0
3
Hydro 4 7% 1% 1%
1
1Solar, wind, nuclear,firewood, dung,biomassforpower (riceresidues,sugar,rubber,palm oil, agribusinesscogeneration).
SOURCE: IEA; FACTS;ASEAN; McKinsey GlobalInstitute analysis PERTAMINA 6
Indonesia petrochemicals is also very attractive market with accelerating
demand growth
Indonesian demand for petrochemical products is growing rapidly
000 metric tons of major products1
▪
18,000 Growth in petro-
16,700
+5% p.a. chemical demand
16,000
14,600 expected to be even
14,000 higher once domestic
11,550 supply enables new
12,000
downstream product
+2% p.a.
10,000 manufacturing
8,750
7,950
8,000 7,350 ▪
Indonesia will likely
remain a net importer
6,000
in near / mid term due
4,000
to insufficient
domestic production
2,000
capacity
0
2000 2005 2010 2015 2020 2024F
1Productsincludeolefins,polyolefin derivatives,aromaticsandbutadienederivatives
SOURCE:CMAI/IHS PERTAMINA 77
Pertamina is active in all segments of the value chain
Overview of PERTAMINA
▪
Largest companyin Indonesia
▪
2012 revenuesof USD 80 bn
▪
15,000employees
▪ Pertamina is the sole
refiner and major
retailer of petroleum
Develop- Refining products in
Transport- Marketing/
Exploration ment and Storage Indonesia
ation Retail
Production Petchem
▪ One of Pertamina’s
mission is to meet
Indonesia’s
petroleum and
demand
▪ Opportunity to
expand into petchem
▪ ▪ ▪
5 bn+ barrels of oil reserves 6 refineries ~5,000 retail fuel stations
market
▪~450 MBOE/day of oil & gas with capacity ▪ ~95% market share in Retail fuel
production in excess of 1 ▪ ~75% market share in Industrialfuels
million
▪
~60% market share in Lubricants
barrels/day
▪
~10% market share in Petrochemicals
SOURCE:PERTAMINA PERTAMINA 8
Pertamina’s aspiration is to be a Fortune 100 “Asian Energy Champion”
by 2025
▪
Be a Fortune 100 company
▪
Revenue of approx. USD 200
2025
billion
aspiration
▪
Become an EBITDA of ~USD 40 billion
“Asian Energy
▪
Integrated energy company
Champion” by
(incl. CBM, geothermal, renewable)
2025
▪
Leading domestic player as well as
international footprint
SOURCE:Pertamina PERTAMINA 9