Building a stronger partnership for the future

July 7, 2014 Claus Ellemann

On Friday, 27th June at FLSmidth’s headquarters, Mr. Dwi Soetjipto, President Director of Indonesian cement producer Semen Indonesia Group, and Mr. Per Mejnert Kristensen, GEVP and President Cement of FLSmidth, signed a Memorandum of Understanding.

The Memorandum of Understanding (MoU) outlines how synergies between the activities of Semen Indonesia and FLSmidth, as well as their individual strengths, can be leveraged by both sides to provide mutual benefit and competitive advantages. During the signing ceremony, both companies agreed to share the responsibility for further developing their long-term partnership and constantly seeking opportunities together – leading to an even stronger and more beneficial alliance.

Per Mejnert Kristensen, EVP & President Cement, FLSmidth and Mr, DWI Soetjipto, President Director, Semen Indonesia, signing the MoU which heralds closer cooperation between Semen Indonesia and FLSmidth in engineering, research and development, manufacturing, services and training for Semen Indonesia's current and future installations. 

Significant new capacity

The whole process of making the MoU gained pace when FLSmidth and Semen Indonesia inked two new deals for adding cement production capacity to Semen Indonesia’s existing lines. The two new contracts, each for an 8,000tpd cement production line, were made effective in early 2014. These contracts are the result of working very closely together in recent years – an alliance that also saw the Tuban IV and Tonasa V production lines successfully commissioned in 2012.

One of the new cement production lines, Indarung VI, is a brownfield cement production line to be located at PT Semen Padang’s plant at Indarung on the outskirts of the city of Padang in West Sumatra. The other one is a greenfield line called Rembang, located on the outskirts of the city of Rembang on the north-eastern part of Central Java. Both contracts comprise the majority of the equipment for the new production lines, including raw mills, coal mills, preheaters, kilns, burners and clinker coolers, as well as silo equipment and complete control systems for the plants.

Additionally, FLSmidth signed a contract in the spring of 2014 with PT Semen Padang for two new vertical cement grinding mills. One grinding mill will be located at the Indarung 6 line, while the other will be at a currently undisclosed (due to ongoing negotiations) grinding plant in the western part of Java.

A legacy of working together
Cooperation between Semen Indonesia and FLSmidth dates back to the early days of both companies. Some 28 years after FLSmidth was founded, the company sold and commissioned its first cement production line in Indonesia. The year was 1910, and marked the birth of PT Semen Padang, Indonesia’s first cement producer and one of the companies today owned by Semen Indonesia. In the years that followed, PT Semen Padang was joined by PT Semen Gresik, PT Semen Tonasa and later Thang Long Cement in Vietnam. Most of Semen Indonesia’s cement plants have been delivered and commissioned by FLSmidth and, even though some of the earliest kilns have now been decommissioned, the addition of new cement production lines over the years has increased Semen Indonesia’s current production capacity to approximately 30 million tons of clinker annually.

During the past 10 years, Semen Indonesia has become not only the largest cement producer in Indonesia, with a market share of 44 percent, but also the largest cement producer in South East Asia. President Director Mr. Dwi Soetjipto’s vision is to expand Semen Indonesia’s production capacity in South East Asia, and to further develop the internal organisation – providing a powerful springboard for building a strong partnership for the future with FLSmidth.

Semen Indonesia intends to utilise this latest agreement to heighten production capacity and increase preventive maintenance by raising its capabilities and organisational skill sets in terms of understanding of the engineering and machinery in its plants. At the same time, the Group is keen to cooperate on optimising existing and future plants with advanced technology, high quality, the lowest possible energy consumption and the minimum possible environmental impact.

The MoU was signed in the spirit that is seeks to follow - representatives of Semen Indonesia and FLSmidth joined hands for the photo sesseion as a symbolic gesture of the closer ties being made between the companies. (l-r: Mr. Ahyanizzaman, CFO, Semen Indonesia; Claus Ellemann, Director, FLSmidth Indonesia; Mr. Suharto Soedjono, R&D Engineering Director, Semen Indonesia; Mr. Per Mejnert Kristensen, EVP & President Cement, FLSmidth; Mr. Dwi Soetjipto, President Director, Semen Indonesia & Mr. Hadi Waluyo, Commissioner, Semen Indonesia.

 

In a small gift exchange, Mr. Per Mejnert Kristensen handed over a porcelain statue of the famous Danish author Hans Christian Andersen. The delighted Indonesian delegation was able to explain that the author was also part of the curriculum in Indonesian Schools.

During the ceremony, Mr. Dwi Soetjipto presented a copy of his recent book about the road to becoming Semen Indonesia. This interesting work contains both contemplations on the past and visions for the future. It also includes historical information about FLSmidth under the heading “FLSmidth, 100-Year Old ‘Cauldron’ of Technological Innovations”.

It was a great day that further cemented the close, strong and successful working relationship between two long-time partners.
 

About the Author

claus.ellemann@flsmidth.com

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