The Indonesian Coordinating Ministry for the Economy and ExxonMobil signed a Memorandum of Understanding (MoU) on Wednesday, January 22, 2025 to explore investment potential for the development of an advanced petrochemical complex in Indonesia.
“This MoU is a joint commitment to support inclusive, competitive, and sustainable economic development. With an investment value of US$10 billion, we hope that this project will have a significant impact on Indonesia’s progress in various sectors,” Coordinating Minister for the Economy, Airlangga Hartarto, said while addressing the MoU signing in Jakarta.
The petrochemical complex is meant to produce high-performance polymers to meet the needs of industry in Asia, while supporting downstreaming and development of domestic industry.
“This project has the potential to provide a significant impact on the Indonesian economy, both through job creation, business opportunities, and reducing imports of high-performance plastics,” Airlangga said.
The petrochemical complex is designed as a low-emission facility by utilizing Carbon Capture and Storage (CCS) technology. It is also expected to accelerate the development of high-performance polymer value chains in Indonesia. ExxonMobil is working with State-energy company PT Pertamina to evaluate the potential for building a CCS Hub in Indonesia, which can be used as a centralized carbon storage solution.
Competitiveness
Deputy for Energy and Mineral Resources Coordination at the Coordinating Ministry for the Economy, Elen Setiadi, said that the government continues to create attractive fiscal conditions to attract investment.
“We are committed to supporting this project, including providing regulatory certainty and relevant incentives,” he said.
The MoU was signed by Elen Setiadi and Vice President of ExxonMobil Zoe Barinaga, and witnessed by Airlangga Hartarto and President of ExxonMobil Indonesia Carole Gall. This collaboration is expected to strengthen the synergy between government, industry, and the society to drive sustainable economic growth.
If realized, this investment will be one of the largest in the global petrochemical sector and strengthen Indonesia’s position as a major player in the Asian energy and petrochemical industry. With its great potential, Indonesia has the opportunity to become a center for the development of innovative low-carbon technology.
Downstream and emission reduction
“The construction of this CCS facility is expected to be able to reduce CO2 emissions by 90 percent. This is a strategic step towards the first CCS project in Indonesia which is expected to operate soon,” Airlangga cited.
As part of the agreement, ExxonMobil will support the development of Indonesian human resources (HR) through worker training according to global standards. This project is also projected to provide a multiplier effect through strategic partnership with local businesses, as well as supporting the development of domestic technology, procurement, and construction.
Location
Secretary of the Coordinating Ministry for the Economy, Susiwijono Moegiarso, said that the location of the CCS facility is still in the survey stage, with a focus on the Java Sea area.
“CCS will capture CO2, then store it on the seabed or rocks. We are looking for storage locations around the Java Sea,” he said.
