BUMI to Convert 7.7 Million Tonnes of Low-Calorie Coal into Methanol

PT Bumi Etam Chemical (BEC), a joint venture between PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia, will utilise low-calorie coal as the primary feedstock for its coal-to-methanol gasification project. In its first phase, the project is estimated to consume 7.7 million tonnes of coal per year to produce 2 million tonnes of methanol annually. BEC President Director Rio Supin stated that the coal to be used has a low calorie value of around 3,300 kcal/kg. He noted that converting low-calorie coal into methanol is part of efforts to increase the added value of mining commodities through downstream processing. The project is estimated to cost more than US$2.3 billion, based on a bankable feasibility study completed in 2025. Rio explained that before entering the gasification process, the coal will undergo a drying process due to its high moisture content. The coal will then be processed into syngas, which will be purified before proceeding to the methanol synthesis and distillation stages. He added that the methanol produced will adhere to international standards set by the European Methanol Producers Association (IMPCA), rather than China’s GB standard, to ensure the product meets global market quality requirements. The project’s strategic location on the edge of the Makassar Strait will facilitate domestic marketing access. In addition to methanol, the project will also produce sulfuric acid as a by-product. All facilities will be built in an integrated manner, including a power plant and water purification installation necessary to support the gasification and methanol synthesis processes. The power plant is considered vital as it will generate not only electricity for the project but also steam required for the gasification and methanol synthesis processes. The coal-to-methanol downstream project, developed by subsidiaries of PT Bumi Resources Tbk (BUMI), has entered a new phase. Through the joint venture PT Bumi Etam Chemical (BEC), this national strategic project has officially moved into the Front-End Engineering Design (FEED) stage and the preparation of the Engineering, Procurement, Construction, and Commissioning (EPCC) Framework Agreement. The FEED and EPCC Framework Agreement was signed by BEC with PT Istana Karang Laut (IKL) and China National Chemical Engineering Co., Ltd. (CNCEC).