Bukit Asam builds $3.9m briquette plant
Bukit Asam builds $3.9m briquette plant
JAKARTA (JP): State-run coal miner PT Tambang Batubara Bukit Asam is building a coal briquette plant in Gresik, East Java, to anticipate the growing need for the fuel by small industry and households, a senior minister said yesterday.
Coordinating Minister for Production and Distribution Hartarto announced after reporting to President Soeharto yesterday that the Rp 9 million (US $3.9 million) plant will have an annual capacity of 120,000 tons of coal briquettes.
The company's president, R.A. Soenardi, said earlier that construction was being financed with a combination of Japanese loans and Bukit Asam's own funds.
Bukit Asam, based in Tanjung Enim, South Sumatra, currently operates two coal briquette plants in Tanjung Enim. They have annual capacities of 3,000 tons and 12,000 tons.
Hartarto said the new plant will be completed in 14 months. Its machinery will be supplied by PT Aryo Seto Wijoyo.
He noted that the new plant will target small-scale industry, including husbandry, tobacco frying and rubber-latex frying businesses, as well as restaurants.
"Promoting the use of briquettes in households, especially for cooking, runs into problems," Hartarto said. In rural areas, for instance, households prefer firewood for cooking to coal briquettes, while urbanites prefer kerosene.
Hartarto noted that "heavily subsidized kerosene prices" are the main barrier to promoting the household use of coal briquettes.
Coal is abundant in Indonesia -- the world's third largest producer of coal after Australia and South Africa -- but is not an ideal energy alternative. The extensive use of coal is not publicly accepted.
"With the abundance of coal, we expect coal to substitute the current extensive use of oil," Hartarto said.
According to official data, 58 percent of the energy consumed in Indonesia in 1994 was oil. Coal ranked at only 8.8 percent. The second largest contributor of energy was natural gas with 25 percent, with hydro-electricity accorded 6.7 percent and geothermal steam 1.3 percent.
Owing to the government's energy diversification policy, oil's share is projected to decline to about 30 percent while coal's share will jump to over 50 percent, Hartarto said.
Hartarto said that the government is inviting the private sector to promote the use of coal and construct briquette plants. (rid)