Jakarta. The Indonesian government is reviewing the long-stalled $24 billion oil refinery project in East Java, a joint venture between state-owned energy company Pertamina and Russia’s Rosneft, due to protracted delays and questions over its commercial viability.

The project, located in the coastal town of Tuban, was launched in November 2017 under a joint entity named PT Pertamina Rosneft Pengolahan & Petrokimia. Despite its ambitious scale -- both financially and technologically -- the refinery has seen little visible progress over the past seven years.

“Pertamina and Rosneft have recently held discussions regarding the Tuban refinery. We are currently reassessing the overall investment,” said Energy and Mineral Resources Minister Bahlil Lahadalia at the Jakarta Geopolitical Forum on Tuesday.

Occupying an 800-hectare site, the refinery is designed with advanced oil processing technology and a planned capacity of 300,000 barrels per day. Once operational, it is expected to produce up to 11,000 kilotons of oil-based fuel and 5,000 kilotons of petrochemical products annually.

However, Bahlil noted that the government and both stakeholders are recalculating the project’s financial framework to ensure long-term sustainability.

“After reevaluating the investment and its potential returns, we’ve concluded that a comprehensive review is necessary to determine the optimal investment level,” he said. “The project must meet commercial feasibility and efficiency benchmarks.”

The Tuban refinery has long been seen as a strategic initiative to reduce Indonesia’s dependence on fuel imports and strengthen its domestic petrochemical industry. But cost escalations, operational delays, and shifting energy priorities have complicated its trajectory.

Bahlil accompanied President Prabowo Subianto to Russia last week for the St. Petersburg International Economic Forum, where both countries reaffirmed commitments to deepen economic ties, particularly in energy cooperation.