Japan agrees to fund feasibility study of Sumatra SNG

Indonesia and Japan have agreed to jointly build Sumatra SNG Project, which will transform low rank coal into Synthetic Natural Gas (SNG) or syngas. Japan will fund the feasibility study of the project.

Representative of Mitsubishi Heavy Industries/ Mitsubishi Corporation (MHI/MC) said during a meting with Director General of Oil and Gas Evita H. Legowo and other government officials in Jakarta on Friday the approval to finance the project was issued late in July. The Indonesian government has asked MHI to present in details the study's time table and work coverage, following the agreement.

In response, Japan asked a formal letter from the Indonesian government its bid to continue the feasibility study at the stage of Front End Engineering Design. According to the plan the Sumatra SNG refinery will have a capacity of 150 MMSCFD. PT CPI and state power producer PLN have committed to buying the SNG gas on business to business scheme. The CO2 produced in the process will be streamed to oil field, helping recover oil production in draining fields.

Syngas is a kind of gas comprising carbon monoxide and hydrogen. Sometimes it contains carbon dioxide. The gas if flammable and commonly used in the process to produce other chemicals.

The Energy Ministry research and development data says syngas has been commercialized since 1950s. There are 53 coal gassification plant to produce syngas that will serve as materials to make materials for chemical industry like fertilizer, petrochemicals, eletricity and city gas. In Indonesia gas plants that applied carbonated coal were closed in 1970s and were replaced by natural gas. Syngas has been developed commercially in the US, by among others Dakota Gasification Co., which produces 152 MMSCFD.(romel)