Indonesia plans $8bn worth of refinery construction contracts with US firm

The proposed deal was outlined by economic affairs minister Airlangga Hartarto during a closed-door briefing to Indonesian business leaders earlier this week. It is one of several commercial agreements forming part of a broader trade pact between the US and Indonesia, announced last week.

The contract with KBR, formerly Kellogg Brown & Root, has not been officially confirmed by either party. But Reuters reported that the refinery plan featured prominently in the official presentation, which was shared with Indonesian industry representatives.

While headline elements of the wider deal have already been disclosed, the refinery component had not previously been made public.

Danantara, also known as Daya Anagata Nusantara, manages more than $900 billion in assets and plays a key role in Jakarta’s plan to raise GDP growth from 5% to 8%.

In total, the agreements could reach $34 billion across sectors including aviation, chemicals and ICT, according to the presentation. Jakarta believes the lowered tariff rate, reduced to 19% from a proposed 32%, could lift national GDP by 0.5 percentage points.