South Korean LG International and local firm PT Duta Firza are conducting a feasibility study on a potential US$1.3 billion petrochemical factory in Bintuni, West Papua, near the gas-rich Bintuni and Masela blocks in Maluku, which would provide raw material to the factory.
If realized, the firm will produce up to 1 million tons of methanol and would need 90 million standard cubic feet per day (mmscfd) of gas with an expected price of $1 per million British thermal units (mmbtu).
Industry Minister Airlangga Hartarto said the project could get gas as a raw material from the Bintuni block, which is scheduled to come onstream in 2021. The Masela block will come onstream in 2022.
“The government opens door to investors, especially in the petrochemical sector in Bintuni,” he said in a press statement on Tuesday.
The minister said he met with LG International CEO Song Chi Ho in Seoul, South Korea, the day before.
The Bintuni block will be developed by the local arm of BP, BP Tangguh with 23.8 trillion standard cubic feet (TSCF) of gas and Malaysian firm Genting Oil Kasuri Pte. Ltd. with 1.7 TSCF.
Other petrochemical companies that have expressed interest in building factories in Bintuni are Germany’s Ferrostaal and Japan’s Asahi Kasei Chemicals, Mitsui and Sojitz.