Pertamina & PTBA formed a coal downstreaming joint venture

Jakarta, APBI-ICMA: January 16, 2019 reported that PT. Bukit Asam Tbk. (PTBA), PT Pertamina (Persero) and Air Products and Chemicals Inc., formed a coal downstreaming joint venture.

The joint venture (JV) will process coal owned by PT Bukit Asam Coal Mine (Persero) Tbk. and derivative products.

In this initial plan, the three companies have signed the main points of agreement for the establishment of a joint venture downstream of PTBA's coal mine mouth in Peranap, Riau.

The signing was carried out by PTBA President Director Arviyan Arifin, Pertamina Managing Director Nicke Widyawati, and Chairman, President & CEO of Air Products and Chemicals Inc. Seifi Ghasemi, witnessed by the Minister of State of the Republic of Indonesia Rini Soemamo at the Grand Hyatt Hotel, Jakarta, Wednesday (1/16).

Minister of State-owned enterprises Rini Soemarno hopes that the realization of the establishment of the coal downstream will soon be realized. Because, he said, Indonesia must continue to develop the coal downstreaming industry not only in order to reduce imports but also to develop exports.

Downstreaming is also important in an effort to reduce pollution from coal by producing clean energy in the form of Syngas which will be upstream from various products such as DME and even diesel and aviation fuel.

"This is indeed the technology where our coal, coal is actually low in calories, so it cannot be transported. But after we learned from some time ago there was technology and this coal could be processed into syngas, then it could become DME," said the Minister Rini at the Grand Hyatt Hotel, Central Jakarta, Wednesday (1/16).

Through gasification technology, coal will be converted into syngas which will then be reprocessed into the final product (finished). Rini is optimistic that this step can help reduce imports because currently 70% of LPG sold in Indonesia is imported.

"Indeed, there is a slight overhaul of the stove, but very, very little. Let's try to see, it's just a lid smaller than LPG. Well, this can be 100% using DME, meaning in the future we don't need to import because now 70% LPG we are still being sold in Indonesia, "he said.

Thus, DME can be an alternative to LPG later. "Well, if we can use this technology, we can all use it with a coal base for our stoves using DME instead of LPG. Yes, just as the system is rich in LPG in the tube, DME is rich in tubes," he added.


The signing was also a continuation of a memorandum of understanding on dimethylether coal downstreaming (DME) carried out by the three companies on November 7, 2018 and then in Allentown, United States.

"I push the groundbreaking target in early March. They say between 12-18 months (the process)," he said.

Before the formation of the company, PTBA, Pertamina and Air Products will conduct a business and commercial feasibility study first. Later, PTBA will supply the coal and the Peranap mine area to a joint venture company to be processed into the final product to be purchased by Pertamina.

"So later our first factory in Peranap in Riau is right near the mouth of the mine, because it can't be transported. Well, we hope that both of them can start production in Tanjung Enim, from Tanjung Enim in the beginning of March. low calorie coal, so we want to push it as soon as possible so we can really suppress imports, "explained Minister Rini.


imports PTBA's President Director, Arviyan Arifin, revealed that the downstreaming of coal could produce DME to replace LPG raw materials, most of which are still imported, so that the downstreaming of coal can directly save the country's foreign exchange.

"PTBA's downstreaming is strengthened by total coal resources of 8.3 billion tons and total coal reserves of 3.3 billion tons," he said.The Pertamina Managing Director Nicke Widyawati stressed that Pertamina's cooperation with Bukit Asam and Air Products was a strategic step for all parties, to improve national energy security, independence and sovereignty, through the use of DME.

"Around 73% of LPG is still imported, in 2017 Indonesia consumes no less than 7.11 million tons of LPG. "This coal gasification plant is a very strategic project nationally because we plan that DME will reduce most of the needs of imported LPG as household fuel," Nicke said.

Air Products President & CEO Seifi Ghasemi is committed that as the owner of coal gasification technology will truly invest in Indonesia and become an important part of the establishment of the industry with upstream technology that produces syngas and then processed through downstream technology into DME.




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