PTBA signs coal gasification agreement

By Tri Subhki R

IDX-listed coal mining and energy company PT Bukit Asam Tbk (PTBA) signed on Friday Heads of Agreement with state-owned oil and gas firm PT Pertamina (Persero), state-owned fertilizer firm PT Pupuk Indonesia (Persero), and IDX-listed petrochemical producer PT Chandra Asri Petrochemical Tbk to develop coal gasification project.

"PTBA will build Bukit Asam Coal Based Industrial Estate located near our mine mouth power plant at Tanjung Enim (in South Sumatra Province), " PTBA's President Director Arviyan Arifin said.

The planned coal gasification plant is expected to start the commercial operation in November 2022. "The construction phase may be started by the end of 2018 or early 2019," Arviyan said.

The plant will produce syngas for fertilizer industry, dimethyle etylene for LPG and polypropylene for petrochemical industry.

"We welcome the coal gasification project and hope we can get more competitive gas price from the project," PT Pupuk Indonesia's President Director Aas Asikin Idat said.

Pupuk Indonesia, through its subsidiary PT Pusri, will be the offtaker of syngas from the coal gasification plant. The company is expected to produce 500,000 tons of fertilizer per year from the project.

Arviyan said that the project will consume 9 million tons per year of coal, including 3.5 million tons for the dedicated power plant.

Editing by Reiner Simanjuntak