Government Discusses Plans for Domestic Coal Downstream Project: Updates on Air Products' Departure

Verda Nano Setiawan, CNBC Indonesia

Monday, 28/08/2023 17:35 WIB

Photo: Infographic/Gasification RI/Edward Ricardo

Jakarta, CNBC Indonesia – The Ministry of Energy and Mineral Resources (ESDM) said that currently plans for a domestic coal downstream project are still under discussion.

This follows the departure of a petrochemical company from the United States, Air Products and Chemicals Inc., from two coal gasification projects to dimethyl ether (DME) and methanol in Indonesia.

Plt. Director General of Mineral and Coal at the Ministry of Energy and Mineral Resources Muhammad Wafid said, after Air Products chose to leave the two joint projects with PT Bukit Asam Tbk (PTBA) and the Bakrie Group, Indonesia is currently looking for other options.

“Still in talks, bilateral we also want to discuss with PTBA the desire to downstream gasification, the search for partners is still continuing,” said Wafid when met at the Ministry of Energy and Mineral Resources Building, Jakarta, Monday (28/8/2023).

Even though there are other options, Wafid said that the government continues to make efforts to keep the coal gasification project into DME running. Moreover, he continued, DME is expected to be an alternative energy to replace Liquefied Petroleum Gas (LPG), which so far has mostly met its needs from imports.

“There may be other options, but that’s still what we need. Don’t let us import the basic material needs from outside while we can still prioritize them. Yesterday’s DME was clear, we imported 70-80%, if we can convert it from our coal. why not. But if it’s for the economy, it makes DME less likely to have other products,” he said.

Previously, ESDM Minister Arifin Tasrif revealed that after the company from the United States (US) chose not to continue its project in Indonesia, the domestic DME project had not been continued.

However, according to Arifin, the use of coal in Indonesia can also be used to produce synthesis gas which can be used as raw material for the fertilizer industry.

“So yes, we have to start again, we start from the beginning, indeed China, because it used to lack urea, also gas, it imports a lot of us because it uses gasification, so it processes coal, right?combustmake synthesis gas for the process of making fertilizer,” he said at the Ministry of Energy and Mineral Resources Building, Friday (4/8/2023).

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