Aiming to expand presence in the petrochemical space, Indonesia’s biggest polyethylene producer, PT Titan Kimia Nusantara Tbk plans to construct a naphtha cracker complex near its industrial plant in Merak, Banten.
Johanes Bambang Budihardja, non-affiliated Director of the publically listed company said the firm intends to spend around three to five billion USD on construction of the new facility with a projected ethylene production capacity of 700 kilo tons per annum (KTA) and propylene production capacity of 500 KTA, Jakarta Post reported.
Originally it was planned to launch the construction of the said plant this year, however due to some problems in acquisition of land for setting up the plant, this has now been pushed back to 2017, while the date for launching operations has been pushed back from early 2016 to early 2018, he said.
Mr. Budihardja said the firm has acquired around 37 hectares of the 100 hectares of land required for building the new complex, but is still negotiating for securing the remaining 60 hectares of land from PT Krakatau Steel, a state-run steel producing company.
Chief Commissioner of Titan Kimia, Lee Hun Ki said the firm plans to obtain around 60 percent of the funds for the new facility from South Korea’s official export credit agency - Korea Eximbank (KEXIM) and the rest from its holding firm Lotte Chemical Titan International Sdn. Bhd.
Lotte Chemical Titan International Sdn. Bhd. holds a 95.31 percent stake in Titan Kimia, while the rest 4.69 percent is held by public.
Last year, Titan Kimia achieved 352 kilo metric tons (KMT) polyethylene production levels, which is the highest level attained since launch of operations by the company.
However, this could not save the firm from incurring a net loss of US$ 16 million.
The firm has been posting negative results since 2010, when it last booked a profit of US$ 23 million on account of enhanced sales and consumer base.
