Govt to build up to three fertilizer plants in Tangguh

The government plans to build up to three fertilizer plants at the gas-rich Tangguh area of West Papua to maximize the use of the country's gas resources for domestic interest, a senior governmental official has said.

Prior to a meeting with the House of Representatives' Commission VII that handles energy affairs, Evita Legowo, Director General of Oil and Gas at the Ministry of Energy and Mineral Resources, said on Wednesday the plan also aims to support the development of the country's agricultural industry.

Between two and three fertilizer plants will be built in the area with each of them needing 60 million cubic feet per day (MMCFD) of gas.

"They thus need between 120-180 MMCFD of gas," she said.

Gas sales and purchase agreements with the area's gas producers are expected to be signed in 2012, she said, adding that feasibility study on development of two plants in the area is now in progress.

Minister of Energy and Mineral Resources Darwin Z. Saleh issued a decree on Dec.31, 2010 calling for the allocation of gas for fertilizer plants to be built in East Kalimantan, Central Sulawesi and Tangguh. One plant, called Unit 5, will be built by PT Pupuk Kaltim in East Kalimantan with feedstock from Mahakam and Sebuku fields, while the plant in Central Sulawesi will use gas from the Donggi Senoro field.

Indonesia is one of the world's largest gas producer, but it exports most of the gas through pipeline or in the form of LNG. (Godang)