"Construction of the project will kick off in the last quarter of this year."Jakarta (ANTARA News) - US investor Celanes Corporation would carry out its plan to build an ethanol factory in Indonesia toward the end of this year, an official said.
The project is coal gasification to turn out methanol to be processed in ethanol for fuel and for chemical feedstock, Director General of Base Industries Panggah Susanto said.
"Construction of the project will kick off in the last quarter of this year," Panggah added.
The project, to cost up to US$2.5 billion, will have a production capacity of 1.1 million tons of ethanol, he said here on Tuesday.
The production will be used as fuel and feedstock in chemical industry, but mainly for fuel, Panggah said.
The project is part of the government`s program to develop downstream sector of mineral industry restricting export of raw minerals in favor of finished commodities.
"It is in line with the program of developing downstream mineral industry and at the same ti to produce more clean fuel," he said.
Construction of the project is expected to take two to three years, he said.
Location of the project, however, is yet to9 be decided as there are a number of factors to be studied including proximity to source of basic material and availability of infrastructure, he said.
It is almost certain that the location is outside Java, as Java has no coal mine, he added.
Celanses will team up with state oil and gas company PT Pertamina and the production would all be for domestic consumption, he said.
Industry Minister M.S. Hidayat said the project would be built in Kalimantan , the country`s largest coal producer.
(Uu.AS/H-ASG/A014)
Editor: Priyambodo RH
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