Indonesia's Bukit Asam eyes $3.1 bln plant to convert coal to synthetic natural gas
JAKARTA, May 5 (Reuters) - Indonesian state coal miner Bukit Asam is studying a plan to invest $3.1 billion into a plant to convert coal into synthetic natural gas, its chief executive said on Monday.
It would be Bukit Asam's latest attempt to produce gas from coal, as the government pushes for domestic value addition on its natural resources, after its partner pulled out from a project to produce dymethyl ether gas.
The Reuters Power Up newsletter provides everything you need to know about the global energy industry. Sign up here.
Bukit Asam plans to convert 8.4 million metric tons of low-grade coal of around 3,700 kcal/kg GAR into 240 billion British thermal unit per day (1.6 million metric tons per year), Arsal Ismail, chief executive of Bukit Asam told members of parliament.
"Some of Bukit Asam's low-grade coal reserves would be very suitable for conversion into synthetic gas," Arsal said, adding the project is aimed at meeting future gas demand in Indonesia.
The company plans to form a joint venture with state-controlled gas distributor Perusahaan Gas Negara (PGN) and a technology provider to build the plant, he said, without naming the technology provider.
Bukit Asam and PGN are currently conducting a feasibility study for the project, including the projected cost of the gas it will produce and its competitiveness against liquefied natural gas.
Arsal said an initial study indicated that the synthetic gas would be competitive against imported LNG. Indonesia is currently a net exporter of LNG, but some analysts expected that it could turn into a net importer by early 2040s.
Bukit Asam previously partnered with U.S. firm Air Products (APD.N), opens new tab to convert coal into dimethyl ether, to produce substitution to liquefied petroleum gas popularly used as cooking fuel.
Air Products, however, pulled out of the project in 2023 to redeploy its capital in other projects.
Bukit Asam is currently in talks with a number of Chinese companies for potential partnership to replace Air Products, Arsal said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South Wales Argus
an hour ago
- South Wales Argus
LTA announces commitment to equal prize money by 2029
For the first time this year, all the LTA's grass court events will feature both men and women's tennis as part of a commitment to give British fans the opportunity to watch the best players, men and women, on home soil and bring women's tennis to a larger audience. The HSBC Championship at Queen's Club will stage a women's WTA 500 and a men's ATP 500 event, whilst the Lexus Eastbourne Open will stage a women's WTA 250 and a men's ATP 250, both tour events of the same level. This year, the events will be providing not just the same experience for fans and players, but a move to true equal prize money over time for the players involved. There are currently material differences between the prize money levels on the women's WTA and men's ATP tours. Whilst the minimum prize money levels are set by the tours themselves, the LTA, with the full support of the WTA, has chosen to significantly uplift the WTA prize money at Queen's and Eastbourne in 2025 and will fully close the gap between WTA and ATP prize money at these events no later than 2029. This year the WTA 500 prize money at the HSBC Championships will rise to a record $1.415m. The HSBC Championships will be the highest paying WTA 500 event, of its draw size, in the world this year. The WTA 250 prize money at the Lexus Eastbourne International will rise to $389,000 – making this the highest paying WTA 250 event anywhere on the tour. Scott Lloyd, LTA Chief Executive said: 'We are making significant increases this year to the women's prize money at Queens and Eastbourne and want to achieve equal prize money as soon as possible. 'The LTA is committed to growing women's tennis, both at professional and grass-roots level and this move is an important part of that commitment. This year fans will be able to enjoy both men's and women's tennis on the biggest stages that we can offer and we want to develop the tournaments so that the women's events deliver a path to profitability and greater visibility for the sport. 'We aspire to play a leading part in the growth and development of women's tennis globally, and we'll continue to explore new ways in which we can do this.' Portia Archer, WTA CEO said: 'We fully support the LTA's initiatives to increase the women's prize pot at its events, with a goal of achieving parity in the longer term. WTA athletes deliver consistently engaging and powerful games on court to entertain courtside fans and worldwide audiences. 'This move sends a powerful message that the women's game is valued and will inspire new generations of girls picking up racquets to know their endeavours will be recognised.'
The Herald Scotland
2 hours ago
- The Herald Scotland
Lord Sainsbury: Give Glasgow greater devolved powers
"A major challenge which government faces if it wants to increase Scotland's rate of growth is a way to find and support such clusters," he said. "All the evidence from other countries suggests that the only way to effectively support clusters is to do so at a city region level. Read more: "I appreciate in Scotland, unlike in England, metro mayors have not yet been introduced, but if you want to support high-tech clusters, this is something I think you should seriously consider, with Greater Glasgow being given powers similar to those devolved to Greater Manchester and the West Midlands." Lord Sainsbury was speaking at the Creating the Jobs of Tomorrow conference organised by Glasgow Chamber of Commerce, where he was introduced to the stage by former Labour chancellor and prime minister Gordon Brown. Mr Brown said growth and productivity have been perennial problems in the UK and Scotland, with innovation the key to boosting performance. A new study by economist Dan Turner, head of research at the Centre for Progressive Policy, has suggested this could unlock the creation of hundreds of thousands of high-value jobs. "There are huge sources of innovation and inventiveness in Scotland, just as has been traditional in our history," he said. "The question is can we turn that into scalable companies that stay in Scotland, invest in Scotland, create jobs in Scotland, and Dan's study suggests we could create 300,000 jobs in the next 10 years. "That's 300,000 well-paying jobs, 120,000 in the new industries, the spin-offs in terms of the service sector another 180,000 - that is a possibility if we invest in the infrastructure, the skills, and the development necessary to achieve that." Lord David Sainsbury (Image: Nate Cleary) Lord Sainsbury is a Labour peer and served as minister for science and innovation under Mr Brown and his prime ministerial predecessor, Tony Blair, between 1998 and 2006. He was appointed a life peer in 1997. Lord Sainsbury said there are new opportunities for employment and growth in sectors such as quantum computing, artificial intelligence and biotechnology. "There are economists that will argue that it is investment that is the engine of economic growth, but we have to realise today that capital flows easily around the world, and it flows as it has always done, to where the best investment opportunities are created by innovation," Lord Sainsbury said. "You can sit in London today and you can invest in Silicon Valley, you can invest in practically any country - until recently you could even invest in Chinese venture capital - because that is what modern communication enables you to do. That is why investment is not the real driver of the economy, it's innovation." Among the other speakers was Michael Spence, who won the Nobel Prize in Economics in 2001 for his work in the analysis of markets with information imbalances. Read more: "There are two things that [people] associate with Adam Smith correctly," Mr Spence said. "One the 'invisible hand', which is the market system is a reasonably efficient tool for decentralising and allocating resources. "That actually is not the most important thing that Adam Smith said, but it's the one that neo-conservatives remember because they elevate market systems to the status of a religion, rather than a way of accomplishing economic and social goals. The most important one for our purposes is specialisation. "Adam Smith meant specialisation within an economy, when of course everything that David Sainsbury talked about in the global economy is just the Adam Smith insight writ large, and of course it is the ultimate source of growth. "Without specialisation you don't get scale of spread your activity over too much territory, and you don't get innovation. You get nothing if everybody has to do everything. "The fundamental message I want to deliver today is that's still true, and that growth is fundamentally about specialisation and structural change."
The Herald Scotland
2 hours ago
- The Herald Scotland
New risks emerge as America becomes less attractive
For decades, international investors have treated US government bonds as the safest place for their money. A long bull market in shares has been supported by American bonds and a sound US dollar. Since the global financial crisis of 2008, the underpinning of a 'safe haven' has helped stock markets to cope with other uncertainties. Now, investors are demanding much higher returns to lend money to the US government long-term. America is becoming less attractive to global investors at a time when its government needs them for finance more than ever. There is plenty to be nervous about. The US government is spending far more than it takes in, with the deficit up this year. Trump's spending and tax cut plans are likely to add to the US national debt over the next decade. And the US dollar has fallen to its lowest level in almost three years. US business confidence is weak, with the full impact of the supply turmoil yet to bite. Many manufacturers had stockpiled goods and components ahead of Trump's tariffs and import controls, but this buffer will soon be exhausted. May's stock market rally might seem reassuring on the surface. Major US technology companies like Apple, Microsoft, Amazon, and Nvidia delivered strong earnings and drove most of the market gains. The biggest seven tech companies alone were responsible for more than half of the US stock market's rise in May. But these trading results do not yet reflect the full impact of the trade war and supply changes. Analysts expect slower earnings growth for these businesses over the next year. Trump still plans further action, and the tariffs to date will produce significant adverse effects; higher consumer prices, lower business investment and lower economic growth. Read more: Perhaps most worrying for investors is the inflation risk building up worldwide. As global tensions rise, governments will spend more on defence, with limited scope for tax increases. Business costs will also increase, as trade disputes continue to disrupt how goods move around the world. Global borrowing costs could force central banks to keep interest rates higher for longer. The Governor of the Bank of England has warned that interest rate cuts are now more uncertain. There are signs that the tension between governments that want to spend more and nervous international lenders is also playing out in the UK, EU and Japan. British government bonds – gilts- are already seeing pressure as investors become more choosy about lending to governments anywhere. The OECD report this month warned that weak consumer confidence and fragile public finances leave the UK vulnerable to shocks. Appeasing lenders by cutting spending or raising taxes would hit economic growth. The end of US exceptionalism, linked to the declining role of the US dollar as a reserve currency, may be a gradual process as it was for the UK. There is still growth in many major US businesses and the US stock market is by far the most liquid globally. Shares have a record of coping better than bonds with rising inflation and there is value is stock markets outside the US. But we may be seeing the end of an era when investors could pay less attention to currency movements. And, although government bonds have a role in diversifying portfolios along with a spread of investments internationally, it is harder now to escape geopolitical risks. The recent stock market rebound may give opportunity to rebalance portfolios. Colin McLean is a director of Barnton Capital
