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Chandra Asri, RI wealth fund to partner to build chlor-alkali plant
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ublicly listed PT Chandra Asri Petrochemical and Indonesia’s sovereign wealth fund INA will join hands to build a “world-class” chlor-alkali plant in Indonesia.
The wealth fund, alongside several other investors, will explore taking an equity stake in PT Chandra Asri Alkali, a subsidiary of Chandra Asri that has been specially established to carry out the project.
“By working together, we aim to significantly reduce Indonesia's import dependencies for caustic soda and bolster our nation's economic resilience,” said INA CEO Ridha Wirakusumah in a statement on Thursday.
Chandra Asri has signed a basic engineering and licensing agreement with a multinational Japanese chemical company Asahi Kasei Corporation for the plant’s development.
Once completed, the facility will be able to produce more than 400,000 tonnes of caustic soda and 500,000 tonnes of ethylene dichloride (EDC) annually, according to the firms.
Read also: Indonesia to propose limited free trade deal with US on critical minerals
Caustic soda can be used for alumina extraction, water treatment and the production of textiles, pulp, paper, soap and detergent.
The project seeks to support country’s goal of developing a robust downstream nickel industry, as the chemicals the plant will produce play an important part in nickel extraction.
Indonesia has the largest nickel reserves in the world, a metal that is critical for the manufacture of electric vehicle (EV) batteries.
The country is seeking to take further advantage of the world’s shift toward EVs by moving from a raw mineral exporter to an exporter of processed minerals and higher-level goods.
Ridha said the deal aligned perfectly with INA’s investment priority of supporting the downstream nickel agenda.
“Chandra Asri's market leadership and demonstrated expertise make it an ideal partner for INA to execute this project. This partnership is a testament to our shared commitment to fostering a sustainable and prosperous future for Indonesia," said Ridha.
EDC, meanwhile, is a core chemical input in the production of polyvinyl chloride (PVC), which is one of the most widely produced synthetic plastic polymers and whose applications include construction and packaging.
“As a core component of the total Chandra Asri Perkasa portfolio package, this chlor-alkali plant will help meet Indonesia and Southeast Asia’s growing needs for caustic soda and EDC,” Chandra Asri CEO Erwin Ciputra said in the statement.
Read also: Indonesia to propose limited free trade deal with US on critical minerals
According to the statement, Chandra Asri Petrochemical is Indonesia’s largest integrated petrochemical company and is based in industry hub of Cilegon and Serang in Banten province.
