Indonesia, China begin feasibility study on 560 mln USD coal-to-methanol plant hinh anh 1Indonesia's Industry Minister Agus Gumiwang Kartasasmita attends signing between PT Powerindo Cipta Energy (PCE) and China National Chemical Engineering Corporation (CNCEC) to begin a feasibility study on 560 million USD worth of coal-to-methanol plant project. (Photo courtesy of Indonesia's Industry Ministry)

Jakarta (VNA) - Indonesia and China have signed a memorandum of understanding (MoU) to conduct a feasibility study of a 560-million-US dollar coal-to-methanol plant, according to a press release from Indonesia's Industry Ministry.

Under the MoU, Powerindo Cipta Energy (PCE) of Indonesia and China National Chemical Industry Corporation (CNCEC) will establish a joint venture to implement the project. The plant, which is expected to be built near a coal mine in Aceh province’s Meulaboh district, will turn 1.1 million tonnes of coal into 600,000 tonnes of methanol per year, about half of Indonesia's domestic consumption.

Industry Minister Agus Gumiwang Kartasasmita said construction for the project is scheduled to begin in mid-2022 and employ 600-700 workers.

Muhammad Khayam, Director General of the Chemical, Pharmaceutical and Textile Industry of the Ministry of Industry, said the project will significantly increase the supply of methanol, while sharply reducing the import demand.

Coal is one of Indonesia's key products with reserves of more than 38 billion tons, enough to meet domestic demand until 2091 with an average mining rate of 600 million tonnes per year.

It is also the largest export commodity with a turnover of 25 billion USD in 2020, followed by palm oil with 20 billion USD, according to Indonesia's Central Bureau of Statistics (BPS)./.