Pertamina resumes propylene supply to Polytama

PT Polytama Propindo, which has stopped production for nearly four months, will soon resume polypropylene production following an agreement from the state oil and gas company PT Pertamina (Persero), Kontan reported on Wednesday.

Amir Sambodo, the president director of PT Tuban Petrochemical Industries (TPPI), the holding company of PT Polytama, said that Pertamina had agreed to resume the propylene supply this week after the state oil company agreed with the new debt payment scheme proposed by PT Polytama.

Amir said that Polytama had agreed to issue bank guarantee worth US$20 million to back up payment to Pertamina?s propylene supply as part of the debt agreement. ?Polytama has also agreed to pay debt installment of $1 million a month to Pertamina,? he said.

With the resumption of the propylene, the raw material for the production of polypropylene (PP), Amir said he was upbeat the production would reach 16,500 tons until March, this year.

In order to meet its target to produce 140,000 tons a year, the company will need a propylene supply of about 296,000 tons. At present, PT Polytama has installed production capacity of about 370,000 tons. (*)