Pertamina plans to turn its lubricant business from an operating unit into a subsidiary this year. The Indonesian energy company says the change aims to give the lubes business more independence.
Pertamina stated its plans in a Dec. 27 earnings advisory. The company said its restructuring of the lubricants business is part of a broader effort to make its downstream marketing activities more profitable. The new subsidiary will operate as PT Pertamina Lubricants.
The lubricants business has already been growing at a fast rate – from sales volume of 363,000 metric tons in 2007 to 603,000 tons in 2011, according to company reports. The company reports sales in 21 countries besides Indonesia and says that 25 percent of sales take place in foreign countries.
Pertamina has three blending plants, all on the island of Java, with combined capacity to make 515,000 tons per year of lubricants.
A number of large oil companies – including Sinopec, Lukoil, Gazprom and Rosneft – have restructured their lubricant businesses as stand-alone subsidiaries in recent years.