From Government of Indonesia

Incitec Mulls Investment in Gasification Plant

Australia's largest fertilizer maker Incitec Pivot Ltd on Tuesday (26/6/07) signed a preliminary agreement with two Indonesian partners to look into the feasibility of investing in a gasification plant to convert coal into synthesized gas, Agence France-Presse reported.

If it goes ahead, the project would see Incitec invest $700 million to $800 million in the plant, which would provide three fertilizer plants in Aceh with feedstock, electricity and steam.

The plants have a production capacity of more than 1.7 million tons annually but currently produce only 300,000 tons because of limited natural gas supplies.

In return for investing in the plant, Incitec would receive some of the ammonia and urea produced by the three plants.

The pact was signed with PT Pupuk Sriwijaya (PUSRI), the holding company of PT Iskandar Muda, which owns the three plants, and state-owned engineering company, PT Rekayasa Industri.

Incitec managing director Julian Segal said assessment of the project is still in its early days and his company would have to be satisfied that any project would meet its strict investment criteria before proceeding, he said.

The feasibility study is expected to be completed by the first quarter of 2008.
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