Humpuss group to share in PT Kaltim Methanol
BONTANG, East Kalimantan (JP): PT Kaltim Methanol Industri, a wholly owned subsidiary of Humpuss group, which was developing a US$350-million methanol plant in Bontang, East Kalimantan, plans sell up to 49 percent of its shares, the company's executive said here yesterday.
Company president director Abdul Wahab said Nissho Iwai Co. of Japan, which had arranged offshore loans of some $250 million for Kaltim Methanol and agreed to buy 60 percent of the company's output, would buy 30 percent of the shares.
"Negotiations are actually still on, but it's almost certain the Japanese firm will buy the 30 percent of the shares," Wahab said.
Humpuss group's equity in the firm amounted to $80.3 million.
An American company and two Asian companies, which he refused to name, and state-owned fertilizer company PT Pupuk Kaltim were bidding for the other 19 percent of the shares, he said.
"We actually prefer PT Pupuk Kaltim, because it has done us many favors," he said during a ceremony to erect the methanol distillation columns at the plant.
The Kaltim Methanol plant is located on eight hectares of land it bought from PT Pupuk Kaltim. Many PT Pupuk Kaltim workers are helping to develop the plant.
The plant, scheduled to be completed in September and start production in December, is the second methanol plant to be built in Indonesia. It is also considered one of the largest in the region with an expected capacity of 2,000 tons per day or 660,000 tons of methanol per year.
The country's first methanol plant in Bunyu Island, also in East Kalimantan, owned by state-owned oil company Pertamina, produces about 160 tons of methanol per year.
Humpuss, controlled President Soeharto's youngest son Hutomo Mandala Putra, became involved in the methanol business several years ago as a domestic distributor of imported methanol as well as that produced on Bunyu island.
Wahab said the methanol market would keep growing, saying the current demand for methanol within ASEAN countries alone stood at 12 million tons a year.
Indonesia's current demand for methanol reached 400,000 tons, 150,000 tons of which were imported, he said.
Methanol is priced at $180 a ton on the international market. In 1994 it hit a record price of $500 a ton.
Methanol, made of liquid natural gas, is used as solvent, antifreeze, refrigerant and chemical intermediate, and is a major component for the production of plywood adhesive.
One third of methanol consumption is for the production of formaldehyde, the major use of which is to produce phenol, urea, melamine, resins and plastics.
Column
Kaltim Methanol held a ceremony yesterday morning to pray for the success of the construction of the plant and to install a 200-ton distillation column measuring 4.5 meters wide, 61.4 meters tall, the final stage of the plant's construction.
The column will carry out the final purification of methanol.
"The erection of the column marks the completion of the plant by 70 percent. We are confident the plant will be finished as scheduled in September and start production in December," said G. Ewers, site manager of Lurgi, the German company which provides technology to Kaltim Methanol.
Lurgi, through its subsidiary PT Lurgi Indonesia Engineering, is also building the plant together with its subcontractors Voest Alpine Duta ICE and PT Ballast Indonesia Construction.
Sunil K. Guliani, deputy project manager of Kaltim Methanol, said Kaltim Methanol's plant used the latest technology and was more efficient than other big methanol plants in the region, including the plant in Sabah, Malaysia, which was also built by Lurgi.
Guliani said the plant had an advantage over many plants due to its closeness to liquid natural gas sources.
Natural gas for the plant would come from the nearby gas fields of Pertamina, Total Indonesia, Unocal and Vico. The fields would channel about 70,000 tons of gases to the plant a day, he said. (jsk)