Aromatic feedstock limited in local market
Aromatic feedstock limited in local market
JAKARTA (JP): The domestic supply of feedstocks for the petrochemical industry will be severely limited in the years to come, Hadiono Sutirto, head of Pertamina's gas and petrochemical division, said yesterday.
Sutirto told a seminar on aromatics that the supply of naphtha, one of the main basic ingredients for petrochemicals, from Pertamina's refineries would decrease steadily as a result of the steady increase in domestic fuel consumption.
The supply of gas condensate, another feedstock for petrochemicals, will also severely be limited because the existing condensate production capacity has been tied up with supplying the aromatics plant being built in Arun, Aceh, and the olefin center of PT Chandra Asri in West Java, he added.
Sutirto said the bulk of Pertamina's surplus naphtha output from its refineries had been committed to Chandra Asri.
"Hence, if there are no new domestic sources of naphtha and condensate, new petrochemical plants will have to import their feedstocks," he told the two-day seminar which is to end today.
He said the Bontang gas field in East Kalimantan and the Lhoksukon gas field in Aceh are the only producers of gas condensate in the country and most of their production has been committed either to foreign buyers or to Chandra Asri's olefin plant and the aromatics project in Aceh.
The aromatics project, slated to come on stream in 1998, is owned by the Humpuss Group. The project is being built by Bechtel Inc. of the United States.
The government has approved the second olefin plant project which will be built by PT Trans-Pacific Petrochemical, a company controlled by Hasjim Djojohadikusumo.
The Trans-Pacific project in Tuban, East Java, will be designed with an annual production capacity of 2.2 million tons.
Sanyoto
Meanwhile, State Minister of Investment Sanyoto Sastrowardoyo told the same seminar that new petrochemical plants may have to import their feedstocks.
But he added that domestic naphtha supplies would increase significantly after the 11 new oil refining projects already licensed by the government came on stream within the next few years.
Sanyoto is optimistic that the petrochemical industry, notably aromatics, has a promising future in the country due to the steadily rising demand for petrochemical products.
He said petrochemical projects accounted for 32 percent of the US$133.85 billion total foreign investment cumulatively approved as of the end of last month.
"Although, the government does not offer any tariff protection, investors are greatly interested in the petrochemical industry," Sanyoto noted.(04)