REPUBLIKA.CO.ID, JAKARTA -- The government has set up an executive coordinating team to support development of the country's crude oil processing industry.

The forming of the team is in line with the presidential regulation No.146 in 2015 on development and expansion of oil refineries in the country.

The presidential regulation signed by the president on 22 December 2015 said oil refineries are to be built by the government and the private sector.

In building oil refineries, the government would cooperate with corporations (KPBU) or by appointment.

Development of oil refineries by appointment would be financed by the government or corporation.

In building oil refineries by KPBU, the energy and mineral resources minister will assign state-owned oil and gas company PT Pertamina to be in charge of the joint venture project (PJPK).

Pertamina will find a corporation to carry out the project through tender.

According to the presidential regulation, the corporation in charge of the project is licensed to operate the refinery in 30 years and the license could be extended for 20 years.

After the termination of the license the corporation is to return the entire assets including land and the refinery in good condition to the government.

The government will support the corporation in the form of tax exemption on imports and in land clearing.

Pertamina could also use international assistance in preparing development of KPBU oil refineries with approval from the finance minister, who is to reimburse the cost of preparing.

Pertamina could form a joint venture with other company to build oil refineries.

Pertamina will purchase oil fuels and other products at commercial prices of the refineries built under KPBU or other refineries.

The refinery production is mainly to meet domestic requirement consumption and exports could be made if there is surplus.

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