Resources Management Indonesia expands into tobacco industry

Resources Jaya Teknik Management Indonesia (RMI), active in capturing CO2 from industrial waste in the country, will expand its Business Dealbusiness into the tobacco industry, making it the first non-tobacco company in the world to enter the sector.

RMI signed an agreement Saturday with Union Engineering of Denmark for the development of Dry Ice Expanded Tobacco (DIET) plants in Indonesia.

The deal was signed in Copenhagen, on the sidelines of the UN climate change conference.

“This is actually the transfer of technology from Union Engineering in order to help us develop CO2 capture technology in Indonesia,” RMI chairman Rohmad Hadiwijoyo said after signing the agreement with Union Engineering chief sales officer Michael Mortensen.

“I hope the Danish government continues supporting the transfer of technology to developing countries like Indonesia.”

Transfer of technology is one of the key issues being discussed at the climate meeting in Copenhagen. Developing countries are demanding that developed countries provide the financing and transfer of technology for developing countries to cope with the impacts of climate change.

Danish Undersecretary for Foreign Trade and Investment Jarl Frijs-Madsen, who witnessed the signing ceremony, said his government “would always support the transfer of technology initiatives by the private sector in Denmark.”

Under the agreement, Union Energy subsidiary AircoDiet will supply RMI with two DIET plants with a processing capacity of 600 kilograms of tobacco per hour. Total investment is pegged at US$12 million.

The two DIET plants will be built in Cilegon, Banten, near RMI’s current CO2 capturing facility that processes the emissions from state-owned PT Krakatau Steel to extract the CO2 and sell it off.

The new DIET plants will use CO2 captured from Krakatau Steel to process tobacco from farmers in Wonosobo, Central Java, with the end product to be sold to Sumatra Tobacco in Medan, North Sumatra.

Of all major cigarette producers in Indonesia, only HM Sampoerna has its own DIET plants. The others import their DIET tobacco needs.

DIET plants expand the volume of tobacco being processed by 100 percent and remove the nicotine and tar. DIET is needed in the production of all non-clove cigarette as well as low-nicotine and low-tar clove cigarettes.

“DIET contains no nicotine and no tar,” said AircoDiet managing director Asbjorn Schwert. “DIET technology makes it possible for 100 percent control of the amount of nicotine and tar in cigarettes. This is why everybody wants it.”

Union Engineering, in cooperation with Philip Morris, developed DIET technology in the 1970s. All major cigarette producers worldwide now have their own DIET plants to produce DIET tobacco.

RMI, Schwert said, would be the world’s first non-tobacco company to build a DIET plant.

RMI operations director Isnanto Wongsosentono said the company would expand its DIET and CO2 purification plants if demand increased.

“We’ll also look into other possible uses of CO2 in other industries,” he said. “We’ve already identified two industries — paper and sugar mills — as possible users for bleaching processes, for which they currently use chemicals.”

RMI’s CO2 purification plant in Cilegon produces 1 million tons of liquefied CO2 per hour. The company plans to expand its plants to produce up to 9 million tons per hour, with total investment of $31.8 million.

A diversified group of companies ranging from oil drilling to hotel business, RMI is currently building another CO2 purification plant in Bogor, which will process waste from cement producer PT Holcim Indonesia. The $11.3-million facility will produce 2.5 million tons of liquefied CO2 per hour.

By Riyadi Suparno, Jakarta Post
12 December 2009

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