Chandra Asri to invest US$965 mln over next two years in 3 projects to expand facilities and production

23-Dec-13

Indonesia’s largest petrochemicals company-Chandra Asri Petrochemical, has allocated US$965 mln over the next two years for three projects to expand facilities and boost production, as per Jakartaglobe. The Indonesian petrochem major has been granted a tax waiver facility as the government aims to strengthen the structure of the petrochemical industry from upstream to downstream in a bid to reduce the country’s dependence on imports, which reached $8.5 billion in 2012. Under the government tax holiday facility, which waives corporate income tax for up to 10 years, Chandra Asri can pioneer petrochemical projects with a total value of over Rp 1 trillion (US$82 mln). Chandra Asri’s investment plan’s first project, which costs US$150 mln, to construct a butadiene plant in Cilegon, Banten, is expected to be completed by the end of this year. The second project, estimated at US$380 mln, will expand its a new naphtha cracker plant’s production capacity by adding furnaces, as well as modifying the main equipment. The naphtha cracker plant expansion will increase propylene production to 470,000 metric tons in 2015 from 320,000 metric tons currently, and ethylene to 860,000 metric tons from 600,000 metric tons. The construction of the new plant was initiated in Q4-2013 and will be completed in late 2015. The major will spend US$435 mln to build a new synthetic rubber plant, also in Cilegon, through a joint venture with France-based tire maker Michelin, named Synthetic Rubber Indonesia.