Semen Indonesia signs cost-cutting deal with Pertamina

Semen Indonesia (SI) has signed an agreement with oil and gas firm Pertamina that will see the latter provide oil for SI’s needs in production, transportation and logistics.

The Jakarta Post says the deal could save SI up to IDR1tn (USS$75.7m) and would also involve Pertamina providing assistance in converting SI’s operations to gas power.

Semen Indonesia’s president director Suparni said: “[The agreement] is to ensure that the company can increase its operations and also to help in the development of new projects. We operate in many regions and consume a lot of energy so Pertamina may assist us in providing fuel, lubricants or even energy to fuel power plants for our new factories.”

Pertamina president director Dwi Soetjipto, who once held the same role at SI, said: “[We will assist] in converting [fuel sources] from oil to gas and also develop the use of geothermal potentials in Aceh. So far, the cement industry’s main energy source has been coal, which is not good for the environment. We will help them convert.”