The Jakarta Post
The government launched a coal gasification project in Bukit Asam Coal Based Special Economic Zone (BACBSEZ), Tanjung Enim, South Sumatra, recently.
The project is being jointly developed by three state-owned enterprises – coal miner PT Tambang Batubara Bukit Asam (PTBA), fertilizer manufacturer PT Pupuk Indonesia and state-owned oil and gas holding company Pertamina – as well as chemical manufacturer PT Chandra Asri Petrochemical.
The project follows the companies’ head of agreement (HoA) on the downstream coal industry.
“The establishment of a downstream business in the mining sector is part of the government’s efforts to add value to mining products to support economic growth,” said State-Owned Enterprises Minister Rini Soemarno at the project’s launch, as quoted in a press statement issued on Tuesday.
Through the coal gasification program, low calorie coal will be converted into syngas, which can be used to produce dimethyl ether (DME), a substitute for liquefied petroleum gas (LPG); urea fertilizers; and polypropylene, a raw material used to make plastic.
These coal-derivative products will be manufactured at the BACBSEZ, which is targeted to begin operation in November 2022.
PTBA president director Arviyan Arifin said the project would make an important contribution to the country’s economy as it would significantly reduce LPG imports and reduce the production cost of fertilizers.
“We want to create added value by transforming coal into downstream products through gasification,” he said, adding that the project was expected to produce 500,000 tons of urea fertilizer, 400,000 tons of DME and 450,000 tons of polypropylene annually. (bbn)