KUALA LUMPUR (March 8): Petronas said today that its US$27 billion (about RM110.5 billion) Pengerang Integrated Complex (PIC) remains on track for completion below the project's budgeted development costs, as it looks to kick-off the complex's full operation by the fourth quarter of 2019.
Speaking during a media conference on the State oil firm's financial results here today, Petronas executive vice president and chief executive officer of downstream operations Datuk Md Arif Mahmood said the savings were obtained via investment rationalisation and engineering optimisation.
“So what we have done is we look at some of the investments and try to optimise the US$27 billion budget. As far as the project is concerned, it is well within that budget. In fact, because of some rationalisation and engineering optimisation that we have done, the project will cost below the US$27 billion mark,” he said.
The national oil company had revealed in August last year that the PIC is expected to be completed on time and below budget.
Today, Arif said Petronas will be able to — with the completion of PIC — add 300,000 barrels per day of refining capacity, as well as another 3.3 million tonnes to its 12.7 million tonnes petrochemical portfolio.
“So it will not just add to our volume, but also expand the range of petrochemical products that will be available for the market — which will put the group in a much better position,” he said.
As at Dec 31, 2018, PIC was 97% complete. Since then, it reached the Ready for Start Up status for its refinery on Jan 21 followed by Mechanical Completion & Steam Cracker Fire Up on Feb 12.
For now, PIC will continue its commissioning stage towards full operation slated for the fourth quarter of 2019.
Petronas’ downstream business recorded a profit after tax (PAT) of RM8.5 billion in FY18, down 25% compared with RM11.3 billion in FY17, mainly contributed by higher operating costs and lower refining and marketing margins. This was despite a 13% increase in its revenue to RM128 billion from RM113.6 billion in the previous year.