State-owned Saudi Arabian oil company Saudi Aramco and Indonesian energy group Pertamina have signed a development agreement to enable further progress on their plans to jointly own, upgrade and operate the Cilacap refinery in central Java, Indonesia. Under terms of the deal, Pertamina will hold a majority 55% stake in the refinery, with Saudi Aramco taking the remaining 45% share.

The pact follows the heads of agreement signed in November 2015 and marks the next stage of the project’s development. To date, the refinery’s upgraded configuration has been completed and the process to select technology licensors will start soon. Basic engineering design work is targeted for completion in the first quarter of 2017, followed in the second quarter by the start of the front-end engineering design (FEED) phase. The project’s start-up is scheduled for 2021.

Capacity at the Cilacap facility, which is part of Pertamina’s Refinery Development Master Plan (RDMP), will be expanded to 400,000 barrel-per-day (bpd) and designed to process Arabian crude oil supplied by Saudi Aramco. The complex will also produce refined products to meet Euro V specifications, basic petrochemicals and Group II base oils for lubricants. Saudi Aramco said that, in addition to meeting rising demand for fuel, the partnership will enhance the competitiveness of Indonesia’s refineries and improve the country’s energy security.

“Indonesia’s growth trajectory is truly remarkable with an ambitious economic agenda underscored by the government’s reforms to increase investments in the infrastructure and energy sectors,” said Saudi Aramco president and CEO, Amin Nasser, adding that the agreement enables the Saudi group to potentially play a bigger role in meeting the rising energy needs of one of the world’s fastest developing economies.