PPLi seeks to renew Pertamina waste management contract

Fitri Wulandari, The Jakarta Post, Jakarta

Waste processing firm PT Prasadha Pamunah Limbah Industry (PPLi) has been negotiating with state-owned oil and gas company PT Pertamina for the management of toxic waste at the Balongan refinery in West Java.

"We are holding intensive talks to find a solution to treating industrial waste -- not only at Balongan, but also at other Pertamina units," Machmud Badres, PPLi sales and marketing manager, told The Jakarta Post over the weekend.

Machmud said the two sides had yet to reach an agreement on a new contract.

The Balongan refinery's waste, which consist of sludge, or oil residue, and spent catalysts -- a chemical substance used to process crude oil into oil-based products -- has been piling up since 2000.

Shrimp farmers and fishermen in Indramayu, West Java -- where the refinery is located -- have protested the pollution and have demanded Pertamina to clean up the waste, which they said had destroyed some 10,000 hectares of shrimp ponds.

There are two options to treat the sludge, Machmud said, the first, to extract remaining crude from the sludge.

"The oil can be used to make synthetic fuel, while solid sludge can be dumped in a landfill," he said.

He said the landfill would be constructed and maintained to prevent any leakage and to hold the waste for up to 30 years.

The second option is to use a biological decomposition process using bacteria to turn the sludge into a non-toxic substance.

As for the spent catalyst, Machmud said, PPLi was studying the possibility of turning the waste into a substitute material to produce cement.

"It is still in a trial stage, to ensure it does not contain toxic substances when it is used to make cement," he said.

Pertamina began facing problems in managing its waste at Balongan after it terminated a contract with PPLi in the late 1990s amid a probe into alleged collusion.

At that time, PPLi was partly owned by Bimantara Citra, a conglomerate controlled by Soeharto's son Bambang Trihatmodjo.

Bimantara, through Aqualindo Mitra Industry, owned a 25 percent stake in PPLi, while U.S.-based Waste Management International (WMI) owned 70 percent and the government 5 percent.

In 2001, Modern Asian Environmental Holdings (MAEH), a waste service company, bought 95 percent of PPLi shares; the remaining 5 percent is held by the government.

Pertamina claims that no other local waste management company, aside from PPLi, has the sufficient capacity to manage a large quantity of industrial waste.

Balongan, which processes about 125,000 barrels of crude oil a day, produces some 4,000 tons of toxic waste a year.

Machmud said PPLi was ready to process Pertamina's toxic waste.

The company processes some 35,000 tons of toxic and non-toxic industrial waste a day from 800 companies.

Separately, an expert in toxic waste management said most standard procedures to treat toxic waste produced by oil and gas activities, such as landfills or incinerating them, were neither efficient nor environmentally friendly.

"The processes commonly used are all exceedingly expensive -- if applied properly -- and invites abuse. The material is dumped somewhere and sits there for some untoward event," the expert, who requested anonymity, replied in an email to the Post.

He proposed an alternative technology that was invented in cooperation with the Bandung Institute of Technology (ITB), which could manage waste safely and at a low cost.

The technology turns hydrocarbon waste into carbon dioxide and water in a low-temperature oxidation process.

He said the technology allowed electricity to be generated from the oxidation process, which kept operating costs low, while solid materials produced during the process could be reused, for example, to patch concrete.