SBO, Palembang— Acting Governor of South Sumatra Elen Setiadi said that the coal-to-dimethyl ether (DME) downstream project in Muara Enim is currently waiting for new investors after investors from the United States withdrew.
Elen, who is also Expert Staff for Regulation, Law Enforcement and Economic Resilience at the Coordinating Ministry for the Economy in Palembang, said on Friday, that the DME project was experiencing problems due to the withdrawal of investors.
“The basis of the DME project at that time was collaboration with potential investors. But they withdrew as investors, so the government is currently looking for investors from China and is still investigating,” he said.
He explained that the reason for the withdrawal of prospective investors from Uncle SAM’s country in the DME project was because the company needed certainty about buyers.
“At that time, buyers had not yet calculated the business model or economic value. The problem is that the price of coal until now two years ago was still very high. If it was used as gasification, with the same gas selling price, who would want it,” he explained.
The purchasing company, which as a customer is also a State-Owned Enterprise, must then pay based on production costs plus a margin. That’s what the government is asking for.
However, when the government discussed and studied the problem, the potential investor withdrew as an investor, he said.
Elen said that efforts to realize the DME project were important considering that South Sumatra is one of the producing regions.
“We are still waiting for this project so that we can realize the downstreaming of coal into gas,” he said.
Meanwhile, Special Staff for the Acceleration of Regional Development, Infrastructure Development and Investment at the Coordinating Ministry for Economic Affairs, Wahyu Utomo, said that all National Strategic Projects in South Sumatra were running according to plan, except for the DME gasification project in Tanjung Enim.
“Except for this project, the investors withdrew so they had to look for a replacement for the existing development plan in Muara Enim,” he said.
