Chandra Asri wins ethylene contract
Chandra Asri wins ethylene contract
JAKARTA (JP): PT Chandra Asri Petrochemical Center, the
country's first olefin manufacturer, has secured a five-year
contract for the sale of ethylene to PT Yasa Ganesha.
Peter F. Gontha of Chandra Asri and Freddy Gozali of Yasa
Ganesha, an ethylene glycol manufacturer, signed a long-term
ethylene off-take agreement here on Tuesday. The signing ceremony
was witnessed by Minister of Industry Tunky Ariwibowo.
Chandra Asri released a statement yesterday revealing that the
agreement requires the company to supply Yasa Ganesha with up to
24,000 metric tons of liquid ethylene each year during the next
five years.
Chandra Asri has agreed to give Yasa Ganesha a discount of
US$7.50 per ton from the international price in Southeast Asia.
"Ethylene glycol is one of the few intermediate plastic
products which does not enjoy tariff protection and we set out to
ensure the pricing structure will benefit the growth and
development of this key product," Gontha said.
He noted that the price discount is aimed at protecting Yasa
Ganesha from the threat of cheap imported ethylene, the main raw
material for ethylene glycol which is used for the production of
polyester.
"Like Yasa Ganesha's products, Chandra Asri's products are not
covered by any tariff protection, and thus we are vulnerable to
foreign ethylene imported at dumping prices," Gontha said.
Last year, Chandra Asri appealed to the government for tariff
protection of up to 40 percent against imports. However, the
proposal drew comments from the public and the government has so
far not responded to the appeal.
Chandra Asri is controlled by the Napan Group, Barito Pacific
Group and Bimantara Group -- all of which are believed to have
strong political connections.
Chandra Asri's olefin center in Anyer, West Java, which has an
annual production capacity of 550,000 metric tons of ethylene,
243,000 metric tons of propylene and 216,000 metric tons of
pyrolysis gasoline, started its trial production last May.
Currently the company's production facilities have been running
at 80 percent of its full capacity.
In addition to Yasa Ganesha, the bulk of Chandra Asri's
ethylene is consumed by its sister company PT Tri Polyta's two
polyethylene resin plants, which are also located in Anyer. Its
pyrolysis gasoline is exported, mainly to Japan. (rid)