MOSCOW (MRC) -- The expansion of several petrochemical projects currently underway in several parts of the country will enable Indonesia to achieve self-sufficiency in the production of olefin, aromatic and other petrochemical products by 2020, reported GV with reference to "The Jakarta Post".
The Indonesian Olefin, Aromatic and Plastic Industry Association (INAplas) said that the expansions and construction of new plants would increase production capacity by between 30% to 40% in the next three to five years, from the current capacity of 3.9 million tons per year.
"Several investors have announced plans to increase production capacity or build new factories this year so, with the new as well as the expanded factories, we hope to no longer need imported petrochemical products by 2020," INAplas vice president Suhat Miyarso said after a seminar in Jakarta.
Suhat said 12 construction projects will be carried out this year, of which five are the expansion of existing plants, while seven are the construction of new plants. The five expansions are to increase companies’ production capacity of certain petrochemical products.
Japan-based Nippon Shokubai, for example, will increase capacity of its acrylic acid plant in Banten, West Java, while Polychem Indonesia will increase its mono ethylene glycol (MEG) production in Banten and PT Petrokimia Butadiene Indonesia (PBI) will increase the capacity of its butadiene plant. Meanwhile, PT Chandra Asri Petrochemical (CAP) will increase its naphtha cracker production capacity in Banten and PT Asahimas Chemical will increase capacity of its polyvinyl chloride (PVC) plant, also in Banten.
"The five expansions are expected to be completed in 2015 and will be able to start operating in the same year," said Suhat, who is also Chandra Asri’s vice president for corporate relations.
New plants will be built by South Korean Honam Petrochemical Corp., which is planning a naphtha cracker facility in Banten, PT Synthetic Rubber Indonesia, which will build a styrene butadiene rubber (SBR) and polybutylene terephthalate (PBT) plant in Banten and PT Unilever Oleochemicals Indonesia, which is planning an oleo chemical plant. German petrochemical company Ferrostaal Industrial Projects will also work together with Chandra Asri to build a methanol-to-olefin (MTO) plant in Papua.
State-owned oil and gas company PT Pertamina will build three refineries, one of which is a joint venture with PTT Global Chemical Public Company Limited (PTTGC).
As MRC wrote previously, Indonesia is set to see a likely influx of at least USD7 billion in new investment in the petrochemical sector in the next three years as the domestic industry tries to keep pace with rising demand. The director for Indonesian Olefin, Aromatic and Plastic Industry Association, said the investment will be made to expand domestic production capacity, which in turn could curb imports that rose to around USD8 bln last year. This investment would translate to 30-50% growth in the industry.
MRC