Hence, the coal gasification attempt provides direct added value to the national macroeconomics sector.
Jakarta (ANTARA) - State-Owned Enterprises (SOEs) Minister Erick Thohir has emphasized that SOEs are fully committed to accelerating the downstream project of processing coal into dimethyl ether, or coal gasification.

"SOEs fully support President Joko Widodo's directives to continue encouraging coal gasification, which aims to reduce our dependence on imported liquified petroleum gas (LPG) and strengthen Indonesia's green energy development," he said in a statement received here on Monday.

He also asked enterprises to develop more downstreaming projects for other natural resources found in the country so that they do not become a source of other countries’ wealth. This is important since most of Indonesia’s resources are exported as raw materials, he said.

This is contrary to Singapore, Malaysia, Thailand, and the Philippines, who mostly export finished and semi-finished goods, he noted.

Furthermore, the latest coal gasification project can reduce LPG subsidies provided under the state budget (APBN) by Rp7 trillion per year and improve Indonesia's trade balance, the minister said.

Related news: Coal gasification to reduce Rp70 trillion subsidy from APBN: Jokowi

"The attempt is also a part of the transformation of SOEs to be ready to face the global market," he added.

The project can process 6 million tons of coal into 1.4 million tons of dimethyl ether, thereby reducing LPG imports by 1 million tons per year, he estimated.

In addition, the coal gasification project is expected to have the multiplier effect of attracting foreign investment, empowering national industry through the implementation of local content requirement (TKDN), and absorbing around 10 thousand local workers, Thohir said.

The project can save up to Rp9.7 trillion in foreign exchange reserves per year, he informed.

"Hence, the coal gasification attempt provides direct added value to the national macroeconomics sector," he added.

The project is a collaboration among state-owned mining enterprise (SOE) Inalum’s subsidiary PT Bukit Asam (PTBA), oil and gas SOE PT Pertamina, and an American company, Air Products and Chemicals Inc.

Related news: SOEs minister supports coal gasification

Translator: Sugiharto Purnama, Uyu Liman
Editor: Rahmad Nasution
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