Pupuk Kujang delays construction of new plant
Saturday, July 23 2016 - 03:16 AM WIB
State-owned fertilizer company PT Pupuk Kujang said it has yet to be able to reach agreement with Pertamina EP Cepu over price of gas to be allocated for a planned new fertilizer plant.
Pupuk Kujang Corporate Secretary Iyus Rusmana said that as a result, construction of the PKC 1C plant has been delayed. He did not say when construction was supposed to be started.
?To date, PT Pupuk Kujang and PT Pertamina EP Cepu have yet to reach agreement on the gas price,? he said on Friday.
Pertamina demands a gas price of US$8 per mmbtu with a 2 percent escalation, while Pupuk Kujang wants a price of $7 per mmbtu with a 2 percent escalation.
Iyus said that the PKC 1C plant is aimed to replace the existing Kujang 1A plant as part of the government?s fertilizer industry revitalization program.
The company plans to develop the new PKC 1C plant in Bojonegoro, East Java, Minister of Energy and Mineral Resources Sudirman Said has allocated 85 mmscfd of gas from the Jambaran Tiung Biru field for the new plant.
Iyus said that there is a proposal to build a new plant in Cikampek, West Java, to replace the Kujang 1A plant, if the company continues to be unable to get gas at a price that is feasible for the PKC 1C plant.
Editing by Reiner Simanjuntak