Pertamina International Shipping (PIS), Indonesia-based oil firm Pertamina’s new unit, is reportedly planning an investment of $4bn to upgrade its fleet and terminals.

The company is expected to spend this amount across the next seven years, reported Reuters.

As part of the refurbishment project, the company is looking to replace nearly 23 vessels as well as add more ships to its fleet.

The news agency cited PIS business planning director Wisnu Medan Santoso as saying: “The new unit plans to replace 23 vessels and expand its fleet, to ensure compliance with the latest International Maritime Organisation standards and eventually serve other regional companies.

“There are many oil and gas players in Association of Southeast Asian Nations (ASEAN) who do not have their own shipping arm, we see this as an opportunity.

“We have a large captive cargo, we have a large economy of scale. We can utilise that to capture opportunities in ASEAN.”

At present, only 5% of the company’s clients are non-Pertamina firms.

Pertamina established PIS last year as part of the Indonesian Government’s initiative to overhaul several state-owned firms.

PIS looks to launch an initial public offering (IPO) in two years.

The company aims to function as a green shipping firm and gradually reduce its transportation of fossil fuels.

Wisnu said: “In the long run we will try to reduce dependence on fuel cargo transportation… we must diversify.”

Meanwhile, in a separate development last August, Transportation Minister Budi Karya Sumadi said that the first development phase of the Indonesia’s Patimban Port in Subang would be completed by October, regardless of previous delays.

The port was expected to commence partial operations in November.

In July 2018, the Government of Indonesia started the construction of Patimban Port with an investment of $3bn (IDR43.2tn).