Hyundai Engineering & Construction and partner Saipem will provide front-end engineering and design (FEED) services for Pertamina’s TPPI Olefin Complex project in Indonesia. Samsung Engineering and partner Technip have also signed a FEED contract for the same project.
Significantly, the two joint ventures will be competing for an engineering, procurement and construction (EPC) contract for Indonesia’s largest petrochemical project, which is estimated to cost $4.05 billion.
The project involves building a giant petrochemical complex in Tuban of Java Island, Indonesia, to produce 700,000 tons of high density polyethylene (HDPE) and linear low density polyethylene (LLDPE), 300,000 tons of low density polyethylene, and 600,000 tons of polypropylene (PP) through a naphtha cracking center (NCC) with a yearly production capacity of one million tons a year, Hyundai Engineering said earlier this month.
Hyundai Engineering said that it has formed a consortium with Italian company Saipem and a local Indonesian company to carry out the FEED work, adding that it has secured a strong position to win the EPC contract to be awarded next year.
Samsung Engineering has teamed up with Technip of France and Indonesian local company Tripatra.
Indonesia is likely to start operations of 22 petrochemicals projects from 2021 to 2025, mainly driven by strong demand for plastics and fertilisers, according to GlobalData, a leading data and analytics company.
GlobalData’s latest report reveals that out of the 22 projects expected to commence operations in Indonesia, four will be methanol projects, followed by three polypropylene projects.
“Indonesia, one of the largest economies in Southeast Asia, is witnessing strong demand for petrochemicals, especially for plastics and fertilisers. Indonesian government plans to minimise dependence on petrochemicals imports by promoting the domestic petrochemical sector to meet the soaring demand,” said Bhargavi Gandham, oil and gas analyst at GlobalData.
Among the upcoming methanol projects in Indonesia, the Air products Bengalon Methanol Plant project leads with a production capacity of 2 million tonnes per annum (mtpa). The project is expected to start operations in 2025.
GlobalData notes that among the upcoming polypropylene projects, the PT Trans Pacific Petrochemical Indotama Tuban Polypropylene Plant (TPPI) project and Lotte Chemical Corporation Cilegon Polypropylene Plant project lead with a production capacity of 0.60 mtpa each. The PT Trans Pacific Petrochemical Indotama Tuban Polypropylene Plant is expected to start operations in 2024 while Lotte Chemical Corporation Cilegon Polypropylene Plant will commence operations in 2025.