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AKARTA: Petrocom Energy Limited (PEL), a Hong Kong-based company engaged in the coal-blending business, will invest US$30 million in a coal-blending facility (CBF) plant with its Indonesian partner PT Krakatau Bandar Samudra, a subsidiary of state-run steel company PT Krakatau Steel (KS).

PEL Chairman and CEO Howard Au said on Friday in Cilegon, Banten, where the plant construction will take place, that Indonesia was the third country chosen after the Netherlands (Rotterdam) and China to build the plant, and the first in Southeast Asia.

“Indonesia was selected because it is the world’s largest coal exporting country,” Au said.

With a coal production capacity of 10 million tons per year, the plant will produce added value through increased coal quality as it will blend both low and high grade coal so that coal resulting from the CBF processing will be of medium quality, ideal for the coal market.

PEL international advisory board member Bambang Setiawan said the coal would be supplied to all industries, including power plants and state electricity firm PT PLN. “We will focus on the domestic market. However, we will also export the coal to China, Japan, South Korea and Thailand,” he said.

Howard also said they had finished a feasibility study, resulting in an agreement to invest and to build the plant.

The plant construction is scheduled to take 12 to 15 months on a 103,000-square meter site. The plant will create 100 jobs when in operation.

The plant in Cilegon is the first of a total of 20 plants PEL plans to complete over five years, with a total investment of $600 million.