Chandra Asri, Ferrostaal ink deal for PP & ethylene plant

20 Jul '13

1 min read

Indonesia’s largest petrochemical firm PT Chandra Asri and German company Ferrostaal Industrial Projects GmbH have signed an agreement to set up a methanol-based olefin production complex in Indonesian province of West Papua.

The complex, to be set up in Teluk Bintuni region would have an annual capacity to produce up to 400,000 tons of polypropylene (PP) and 175,000 tons of ethylene, according to The Jakarta Post report.

The construction work for the US$ 1.89 billion project would start after completion of the feasibility studies as well as the decision on gas prices and allocation from the Ministry of Energy and Mineral Resources.

However, the Tangguh liquefied natural gas (LNG) plant in West Papua is expected to supply gas for the petrochemical complex, which is expected to be completed by 2019.

The Indonesian Government is currently focusing on development of the petrochemicals sector, along with other sectors, for industrial growth. The growth of petrochemical sector is expected to decrease the country’s dependence on imports of propylene, ethylene, polypropylene and methanol.

In 2012, Indonesia imported petrochemicals worth US$ 8.5 billion from several countries, including Singapore and Thailand.

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