Pertamina signed a joint venture agreement with the Iranian company and Malaysia’s Petrofield Refining Co. on July 29 to build a refinery with a capacity of 150,000 barrels of oil a day, Priyo Utomo, Pertamina’s senior vice president for business development, said in an interview late yesterday.

The refinery was expected to help Indonesia, Southeast Asia’s biggest importer of gasoline and diesel, cut its dependence on imports. Iran in 2006 said it would guarantee crude oil supplies to the proposed refinery, which at that time was estimated to be completed in 2011.

“We may fund 75 percent of the project cost using loans,” Priyo said. The venture partners expect to complete financing agreements by the first half of next year, he said.

Construction may cost as much as $4 billion, Priyo said. Pertamina and the Iranian oil company will have 40 percent each of the project, while Petrofield will own the rest, he said.

Phone calls to National Iranian Oil weren’t answered as Friday is a weekend holiday.

PIN/Bloomberg