ASIATODAY.ID, BONTANG – Indonesia has officially begun the construction of its first soda ash plant, marking a major milestone in the nation’s industrial independence. The facility, located in the Bontang Industrial Estate (KIE), East Kalimantan, represents an investment of approximately USD 310 million (IDR 5 trillion).
The plant will cover 16 hectares of land, create around 800 jobs, and is expected to be completed by March 2028. Preparation works began in June 2025, signaling a strong push toward strengthening the domestic chemical industry.
President Director of PT Pupuk Indonesia (Persero), Rahmad Pribadi, called the project a historic achievement.
“Indonesia has been striving for more than three decades to build its own soda ash plant. Today marks the beginning of that dream coming true. This is a symbol of progress and industrial self-reliance,” Rahmad said during the groundbreaking ceremony in Bontang, Friday, November 1, 2025.
Soda ash, or sodium carbonate (Na₂CO₃), is a white powder widely used across industries — from glassmaking and detergents to water treatment and paper production.
USD 310 Million Investment, Led by National Companies
Pupuk Kaltim President Director Gusrizal revealed that the project is being executed by PT TCC Indonesia Branch Enviromate Technology International (ETI) and PT Rekayasa Industri (Rekind) as main contractors.
“The total investment is about USD 310 million, financed by our own funds with support from national banks,” Gusrizal explained.
Reducing Soda Ash Imports by Up to 30%
Rahmad noted that Indonesia currently imports around 1 million tons of soda ash annually from countries such as the United States and China. Yet, the country already possesses all key raw materials, including CO₂ and ammonia, which are abundantly available at Pupuk Kaltim and Pupuk Indonesia Group facilities.
Once operational, the Bontang plant will produce 300,000 tons of soda ash per year, enabling Indonesia to cut imports by up to 30%. It will also produce 300,000 tons of ammonium chloride, an essential fertilizer material that currently costs Indonesia around USD 15 million annually in imports.
“This facility will not only replace imported soda ash but also reduce our dependency on imported ammonium chloride, which is crucial for palm oil plantations,” Rahmad added.
Driving Green Chemistry and Downstream Industry
Bhimo Aryanto, Senior Director of Business Performance & Assets Optimization at PT Danantara Asset Management (Persero), highlighted that soda ash is also a key material for producing lithium carbonate, an essential component in electric vehicle (EV) batteries.
“With its significant production capacity, this plant will strengthen the downstream value chain, gradually replace imports, and even open export opportunities in the future. It’s a tangible example of Indonesia’s commitment to industrial downstreaming,” Bhimo stated.
He added that the project is expected to boost Bontang’s economic growth from 9.8% to 10.5%, while creating thousands of local jobs and hundreds of permanent positions.
A Strategic Step Toward Industrial Independence
The establishment of Indonesia’s first soda ash plant aligns with the government’s agenda to promote industrial self-sufficiency and import substitution. Beyond economic benefits, it is expected to serve as a benchmark for green chemical industry development in Indonesia.
Backed by strong collaboration between state-owned enterprises and national contractors, this project reflects Indonesia’s growing capability to meet its own industrial chemical needs — a decisive step toward a resilient and sustainable economy. (AT Network)
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