JAKARTA (TheInsiderStories) - Mitsubishi Gas Chemical Company, Inc. has agreed to further invest in the ammonia project being developed by PT Panca Amara Utama (PAU), said the company in press statement.
Mitsubishi said since discontinuing its ammonia production toward the end of July 2015, MGC has continued to distribute ammonia to customers and produce derivatives, using purchased ammonia.
“By participating in the Indonesian project, MGC will not only ensure a stable supply of ammonia, but also, through an investment vehicle, help PAU, a producer of ammonia mainly using Indonesian natural gas, achieve stable management of ammonia,” Mitsubishi said.
PAU is a joint venture by publicly-listed LPG refinery PT Surya Eka Perkasa Tbk (IDX: ESSA) and Mitsubishi Corporation, through an investment vehicle.
President of Indonesia, Joko Widodo, inaugurated the groundbreaking of PT Panca Amara Utama’s (PAU) ammonia facility in Banggai Regency, Central Sulawesi On 2 August 2015. The factory is constructed in supporting the government’s directive of significant value addition to Indonesia’s natural resources, particularly the usage of natural gas as a raw material in the production of ammonia.
PAU President Director Garibaldi Thohir said, that the factory will produce ammonia, a chemical compound used to manufacture fertilizers, explosives, acids and other petrochemical products. The facility features an annual production capacity of 700,000 tons, with 55 million standard cubic feet per day (MMSCFD) of natural gas to be supplied from the Senoro – Toili Block, operated by JOBPMTS and will start a commercial operation by the of 2017.
Previously in 2014, PAU secured a $509 million syndicated loan facility led by the International Finance Corporation (IFC), the reputed private arm of the World Bank, as well as seven international banks. Additionally, the project supports the use of significant local content for construction – 61 percent of the Project Cost and 87 percent of the Operating Cost will be spent in Indonesia.
Worldwide demand for ammonia, which now totals approximately 180 million tons per year, is expected to grow while being driven primarily by fertilizer uses.
Surya Esa Perkasa controls 60 percent of shares in PAU will construct a fertilizer factory through the use of natural gas from the Senoro-Toili (Donggi-Senoro) gas field in Central Sulawesi, and receive 55 MMSCFD worth of gas supply from JOB Pertamina-Medco E&P Tomori Sulawesi to produce ammonia. (*)