The Jakarta Post
Publicly-listed oil and gas firm PT Energi Mega Persada (EMP) is seeking to diversify its business by developing two purified terephthalic acid (PTA) plants worth US$600 million this year.
The new facilities will have a combined production capacity of 1.6 million tons of PTA, a key raw material used in making polyester.
EMP, through its subsidiary PT Energi Mega PTA, signed a memorandum of agreement with China’s Reignwood International Investment Group on Feb. 3, through which the former will acquire the latter’s future PTA plants in an unspecified location under an engineering, procurement and construction contract.
Reignwood currently operates two PTA facilities with an overall capacity of 2.1 million tons in China and has another two PTA projects on the pipeline.
“The company [EMP] is taking a chance to diversify by penetrating the petrochemical business industry, which has been growing with a more stable cash flow [compared to the oil and gas industry],” said EMP president director Imam P. Agustino in a statement on Friday.Read also: Energi Mega Persada seeks to maintain production after block losses
EMP expected to secure loans with low-interest rates from several Chinese lenders to finance the acquisition of the two facilities this year, he added.
EMP, affiliated with tycoon-cum-politician Aburizal Bakrie, saw its oil and gas production average at 27,800 barrels of oil equivalent per day between January and September 2017, down 34.27 percent year on year (yoy). As a result, its revenue fell by 38 percent yoy to $242.3 million. (lnd)