Pertamina to Build 1 Billion-Cubic-Feet-Per-Day Coal Gasification Plant with Technology from MIT

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Researched by Industrial Info Resources (Sugar Land, Texas)--Indonesian government-controlled energy firm PT Pertamina (Jakarta, Indonesia) has announced plans to construct a coal gasification plant with a capacity of 1 billion cubic feet per day. The plant is expected to strengthen the feed for electricity generation and fertilizer production in the country.

Preliminary preparatory and feasibility studies are under way. The company is also talking to coal gasification technology partners for this venture. Project sources indicate that Pertamina is likely to select the Massachusetts Institute of Technology (MIT) as the technology expert for this project.

MIT and its affiliates have extensive experience in the field of coal gasification, having executed several large-scale contracts. Industry experts indicate that the coal gasification technology deployed by MIT is considered to be one of the most energy-efficient methodologies in this field. This technology could reduce the selling price of gas to about $3 per million British thermal units.

Indonesia's primary energy transmission and distribution company, Perusahaan Listrik Negara (PLN) (Jakarta, Indonesia), has expressed interest in purchasing gas from this project. PLN has stated that the gas feed from the coal gasification facility will be more energy-efficient in comparison to conventional gas sources. The coal gas can be used during peak and base loads, while traditional gas feed can be utilized only during base load. However, sources have indicated that it is critical to evaluate and identify operational logistics so that coal gas production is economically viable.

The coal gasification process involves the reaction of coal or any other high carbon-rich fuel source with oxygen and steam. This reaction leads to the formation of a gas called syngas, which is a mixture of hydrogen and carbon monoxide. Syngas can be used to manufacture ammonia and other fertilizers; augment the efficiency of traditional fuels; or produce gasoline, diesel and other fuels.

Currently, about 85% of energy produced worldwide comes from fossil and conventional energy sources. Coal gasification is emerging as a popular clean energy alternative. Recently, Perdaman Industries (Perth, Australia) announced plans to proceed with the country's first commercial coal gasification plant. The project, which is estimated to cost about $467.2 million, has received an investment of $33.6 million from Samsung C&T Corporation (SEO:000830) (Seoul, South Korea). Additional investment is also likely to be made on a carbon capture and storage unit. The 2 million-ton-per-year project will be located near the mining town of Collie, 213 kilometers from Perth. Local coal will be used to produce urea.

Coal India Limited (CIL) (Kolkata, West Bengal) and GAIL India Limited (BSE:532155) (New Delhi) have established a 50:50 joint venture to develop a $521.7 million coal gasification project. A coal block from the Talcher coalfields has been allocated for the project.

PT Pertamina, which is engaged in upstream and downstream activities, is focusing on developing clean and renewable energy sources. Recently, the company began drilling activities in Bengkulu to explore the possibility of harnessing geothermal energy. Drilling and exploration activities are expected to be completed in two years. Project officials have indicated that an investment of about $3 million will be required to produce 1 megawatt (MW) of power from this source. Pertamina has identified geothermal points at Bukit Daun, Hulu Lais, and Tambang Sawah. While Tambang Sawah is estimated to have the potential to generate 250 MW of power, the geothermal points at Bukit Daun and Hulu Lais have the capacity to generate 173 MW and 660 MW, respectively.

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