Indonesian Pertamina's shipping unit plans up to $3 B investment for vessels

11/23/2022

(Reuters) - Pertamina International Shipping, a unit of Indonesia's state energy firm, aims to invest up to $3 B over the next five years to rejuvenate and expand its fleet, including investing in vessels to transport liquefied natural gas, an executive said.

Pertamina International Shipping (PIS) operates more than 400 vessels, including three very large crude carriers (VLCC) and two very large gas carriers (VLGC).

"We will invest big in replacing vessels," Wisnu Santoso, a director at PIS told reporters on Tuesday. "We want to reduce the average age of our fleet within the next five years to 15 years from currently at around 20 years."

The company is also planning to acquire vessels for LNG transportation, which it currently does not have in its portfolio, as demand for the fossil fuel, which is considered less polluting than others, is expected to increase.

He acknowledged that shipping yards are at full capacity now and building new vessels could be expensive due to high demand, but the company is open to purchasing existing vessels as long as they still have good economic value.

PIS in October signed an initial agreement for strategic partnership with Japan's shipping company Nippon Yusen Kaisha (NYK) with potential collaboration for LNG logistics business on domestic or international routes, the company said last month.

Wisnu declined to share details of the partnership that were currently being finalized.

(Reporting by Fransiska Nangoy; Editing by Kanupriya Kapoor)