PT Energi Mega Persada Tbk. (“EMP”) today reported that on the 3rd of February 2018, its subsidiary, PT Energi Mega PTA (“Energi”) signed a Memorandum of Agreement for establishment of a manufacturing facility to produce Purified Terephthalic Acid (“PTA”) with a capacity of 1,600,000 tons annually with two lines (PTA is the main component required to produce polyester).
The strategy of entering into Petrochemical Industry is to diversify from a highly volatile pure oil and gas producer to adding a more stable highly cost efficient PTA business which has many applications.
The project is expected to cost around USD 600 million including costs of land, building, installations, civil works, electrical and mechanical works, testing and the project handover to Energi.
The memorandum agreement was signed with Reignwood International Investment (Group) Ltd. (“Reignwood”). Reignwood is currently operating two lines of PTA with a combined manufacturing capacity of 2,100,000 tons in China. Reignwood has additional two lines that it proposes to sell to Energi on an EPC (Engineering, procurement and construction) basis.
Mr. Syailendra Bakrie, Deputy President Director of EMP, said,” We are taking the opportunity to diversify our business by entering into growing petrochemical industry with stable cashflow. We hope our entry into petrochemical industry will balance a more volatile oil & gas industry in the future for EMP.”
Mr. Imam P. Agustino, the President Director of EMP, added, ”We look forward to completing such transaction and to securing the low cost project financing from several Chinese banks to fund the acquisition within this year.”PDF file - Bahasa PDF file - English