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tate-owned oil and gas giant Pertamina is seeking external funding to upgrade its refineries following the withdrawal of its Japanese partner from the project.

Pertamina finance director Arief Budiman said on Thursday that the company would need US$ 2.6 billion for the next three to four years to support the first stage of its Balikpapan refinery upgrade. The company has decided to go through with upgrading the refinery on its own after failing to reach a deal with major Japanese oil company JX Nippon.

'€œGiven the big amount of the required funds, it is likely that we will need external funding,'€ he said, adding that the funding would be used for the first stage of the refinery project.

The first and second phase of the Balikpapan refinery upgrade is estimated to cost $5 billion. The first stage of development is estimated to be completed by 2019.

Arief acknowledged that seeking external funding would be challenging considering the currently low prices of oil.

'€œLooking for funding is harder now because lenders and investors want to ensure realistic financial assumptions and efficiency programs to reduce expenditures,'€ Arief said.

Global oil firms are struggling to survive from the ongoing plunge of world crude oil prices. The benchmark West Texas Intermediate (WTI) for March delivery touched at $26.43 per barrel on Thursday, according to figures from Bloomberg. Meanwhile, another benchmark, the Brent crude for April delivery, reached $30.43 per barrel.

Pertamina aims to reduce its operational expenditures by 30 percent as part of efficiency measures amid low oil prices.

'€œThe initial operational expenditure is around $4 billion,'€ Pertamina upstream director Syamsu Alam said earlier.

The Balikpapan refinery is among Pertamina'€™s refineries that will be upgraded to a higher capacity to produce more complex products. Other refineries under a similar upgrade program are Cilacap, Dumai and Balongan, in which Pertamina is planning cooperation with Saudi Aramco.

Along with its planned partnership with Saudi Aramco, Pertamina also signed in late 2014 agreements with Japanese JX Nippon Oil & Energy Corp. and China'€™s Petroleum & Chemical Corporation (Sinopec) to upgrade Balikpapan and Plaju refineries, respectively. The total planned investment for the five refineries was estimated to be up to $25 billion.

However, the planned partnership with JX Nippon and Sinopec collapsed as Pertamina failed to reach detailed partnership agreements with the two firms.

Pertamina president director Dwi Soetjipto said earlier that a deal with JX Nippon collapsed as the partner'€™s investment estimate was higher than the state-owned firm'€™s own forecast.

The upgrade to Cilacap, which is also estimated at $5 billion, with Saudi Aramco is under way. For the Cilacap project, Pertamina will own between 55 percent and 65 percent, and the remaining 35 to 45 percent will be held by Saudi Aramco. Cilacap refinery'€™s capacity will be lifted to 370,000 barrels per day (bpd) from the current 270,000 bpd.