Indonesia to produce synthetic fuel

Indonesia plans to produce synthetic fuel using its abundant coal stocks, as part of its energy diversification program. The factories are expected to begin production in 2013 with a combined output targeted at 13,500 barrels per day. The government will appeal for technical support from Japan to convert coal to liquid fuel, said Nenny Sri Utami, Ministry of Energy and Mineral resources head of the Research and Development Center. The coal-based fuel is expected to contribute 2% to national energy supply by 2025. Indonesian and Japanese firms will establish a consortium and set up factories in coal-rich provinces, such as South Sumatra, East and South Kalimantan, with an initial investment of US$1.3 billion in 2009, she said. The project involves Japan Coal Energy as a ready buyer, Kobe Steel as contractor, Indonesia’s PT Arutmin as coal supplier, state-run oil firm PT Pertamina and the Energy and Mineral Resources Ministry’s research and development center. Indonesia’s coal reserves are estimated at 36 billion tons. Production is projected to reach 212 million tons this year. (May 22, 2007)