Pertamina Lubricants, a subsidiary of state oil and gas company Pertamina, that produces engine oil and brake fluid has launched the first phase of operations of the Jakarta Production Unit, the largest integrated lubricant plant in South East Asia.

The production facility consists of a lube oil blending plant (LOBP) with a capacity of 270 million liters per year, a grease plant with a capacity of 8,000 metric tons per year, and a viscosity modifier plant with a capacity of 14 million liters per year.

Pertamina president director Dwi Soetjipto has said that the production facilities would strengthen Pertamina Lubricants'€™ ability to face competition in the global lubricant market. "The largest lubricant production facilities in Southeast Asia are now ready to serve the needs of the domestic, automotive, and industrial market," said Dwi at the plants'€™ opening ceremony held in Jakarta on Friday.

The annual production capacity of the LOBP is enough for the lubricant replacement of more than 67.5 million cars. "Pertamina could become a leader with these facilities in Jakarta, Surabaya and Thailand," said Dwi, adding that such expansion was important due to the implementation of the ASEAN Economic Community.

 State-Owned Enterprises Minister Rini Soemarno added that this project showed Pertamina'€™s commitment to compete in the global market. However, she stressed that the increased production capacity must be accompanied by enhanced marketing and promotion to compete in the AEC.

She said that many foreign products had entered Indonesia and were ready to compete with Pertamina products in the country. Therefore, she demanded that national standards be established so that Pertamina lubricant products could fairly compete with foreign products.

Pertamina Lubricants plans to increase its production capacity in the next five years by intensifying operations in eight countries and producing additives for its lubricant products.

The eight countries that will be the focus of Pertamina Lubricants'€™ plan to intensify and expand its operations are Thailand, Cambodia, Vietnam, Myanmar, South Africa, Australia, Malaysia and Singapore. The company especially aims to intensify its operations in the Southeast Asian market, using its Thailand branch as the center of its activities.

According to president director Gigih Wahyu Hari Irianto, the company plans to export 15,000 liters of lubricant next year, a significant increase from this year'€™s target of 10,000 liters. The company dominates the domestic market with a 60 percent market share and domestic sales totaling 435,000 liters. "We are aiming for domestic sales to reach 450,000 liters," he said. (+)

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