BEC to Develop US$2 Billion Coal Gasification Project

PT Bumi Etam Chemical is realising a coal downstreaming project into methanol worth US$2.3 billion in East Kutai, East Kalimantan. The national strategic project is targeted to produce two million tonnes of methanol annually.

The Ministry of Investment and Downstreaming/BKPM noted that the development of this gasification facility utilises low-calorie coal as the primary raw material. To meet the annual methanol production target, the facility requires a coal supply of approximately 7.78 million metric tonnes per year.

The basic engineering phase officially commenced after PT Bumi Etam Chemical signed the Front End Engineering Design (FEED) contract and EPCC Framework Agreement in Jakarta on Wednesday (29/7/2026). This step serves as the main foundation before the project enters the construction phase.

BKPM Director of Mineral and Coal Downstreaming Rizwan Aryadi Ramadhan expressed appreciation for the investment commitment in developing the facility. “We also express our utmost appreciation for the investment of US$2.3 billion which will be realised in this project,” said Rizwan.

Rizwan hopes the investment value can continue to increase in line with developments on the ground. He stressed the importance of the economic impact for the surrounding community and increasing national technological independence through knowledge transfer. “We also encourage this project to enhance national technological independence and create knowledge-based added value through the transfer of knowledge,” Rizwan stated.

The project is considered a concrete step in stakeholder collaboration to reduce Indonesia’s dependence on methanol imports. The implementation of this downstreaming is also expected to create new jobs in the region. “Together we build resource sovereignty, open employment for thousands of our brothers and sisters, and most importantly, improve the welfare of the communities around the project,” Rizwan concluded.