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)