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tate-owned oil and gas giant Pertamina has stepped up its overseas expansion in upstream projects with the recent signing of a memorandum of understanding (MoU) with Russia’s Rosneft oil company.

The two companies agreed earlier this week to soon sign a legally binding document that will allow Pertamina a 20 percent stake in Rosneft’s project on the northern tip of the Chayvo field on Sakhalin Island in Russia.

The project is cited to have a maximum production capacity of 1.5 million tons of oil per year starting from 2017, as it has a reserve of around 15 million tons of oil and 13 billion cubic meters of gas, according to Rosneft’s official website.

The two companies also signed on Tuesday an MoU to allow Pertamina to hold a 37.5 percent stake in Rosneft’s Russkoye field in Tazovsky district. Russkoye is one of the largest fields in Russia with recoverable reserves estimated at 410 million tons of oil and 85 billion cubic meters of gas.

Pertamina president director Dwi Soetjipto expressed optimism about the two companies’ future cooperation and reaffirmed that it was a step forward in Pertamina’s long-term plan to increase overseas oil and gas production.

“The cooperation between Pertamina and Rosneft acts as a strategic milestone in our commitment to boost Pertamina as a global energy player and its chosen partners in Pertamina’s international businesses. This will also help us reach our target of participating and operating upstream assets abroad,” he said recently.

Pertamina has a long-term plan to boost its current oil and gas production to 1.9 million barrels of oil equivalent per day (boepd) by 2025 from a measly 624,000 boepd in 2015.

Up to 473,000 boepd is set to be acquired from fields overseas. Pertamina currently has participating interests in several oil and gas fields in Algeria, Iraq and Malaysia, with a total production of 120,600 boepd in August.

Upstream is not the only sector Pertamina and Rosneft will partner up on. The two companies have signed a joint venture agreement for the construction of the Tuban refinery in East Java, Pertamina’s first oil refinery to be built in 22 years.

Through the agreement, it was established that Pertamina will have a controlling stake of 55 percent while Rosneft will hold the remaining 45 percent.

The Tuban refinery will be completed by 2021 with a processing capacity of 300,000 barrels of oil per day (bopd). Though a final investment decision has yet to be reached, it is estimated the project will cost between US$12 million and $14 million.

“I am confident that we will keep up the pace of the development of our partnership for the benefit of our companies and both countries,” said Rosneft president director Igor Ivanovich Sechin.