A strong relationship with FLSmidth advances PT Semen Indonesia rapidly on the road towards 75 million tpa of cement by 2030.
PT Semen Indonesia’s newest cement plant is rapidly taking shape, with commissioning expected to commence by the end of 2016. The greenfield plant, located near the city of Rembang in the north-eastern part of Central Java, Indonesia, will have a capacity of 8000 tpd and is expected to contribute significantly to infrastructure development in the region.
Mr. Ari Wardhana, Semen Indonesia’s Head of Rembang Project, says the project is vital to achieving Semen Indonesia’s ambitious cement capacity goal of 75 million tpa by 2030. Owner of Semen Padang, Semen Tonasa and Semen Gresik in Indonesia, as well as Thang Long cement in Vietnam, Semen Indonesia is Indonesia’s largest cement producer with a total annual output of approximately 30 million tpa clinker.
“Our strategic goals are to keep our 44 percent market share in the Indonesian cement market, which is 82 million tons domestic installed cement capacity,” - Ari Wardhana, Head of Rembang Project, Semen Indonesia
Building a legacy
The greenfield project was awarded to FLSmidth in 2014, but cooperation between Semen Indonesia and FLSmidth dates back to 1910, and most of the cement producer’s plants have been delivered and commissioned by FLSmidth in the years since. FLSmidth supplied three of Semen Padang’s existing production lines in Indarung and upgraded the fourth in the mid-90s. FLSmidth also supplied all four existing lines for Semen Tonasa in Pangkep and all four existing lines at Semen Gresik’s Tuban plant.
The two most recently supplied FLSmidth lines were commissioned in 2012 at Semen Gresik (Tuban 4) and Semen Tonasa (Tonasa 5) plants. Currently, FLSmidth is also supplying engineering and equipment for a new line at Semen Padang (Indarung 6). Claus Ellemann, Director at FLSmidth Indonesia, who has been closely involved with Semen Indonesia since 2006, elaborates on the cooperation between the two companies:
“Our partnership reflects the synergies of our activities and our individual strengths. Both parties are leveraging these to achieve mutual benefit and competitive advantages.” - Claus Ellemann, Director, FLSmidth Indonesia
With the first design meetings for the Rembang project held in January 2014, the contract with FLSmidth comprised engineering and equipment for the main part of the production line, including an ATOX® raw mill, coal mill, preheater, kiln, burner, clinker cooler and silo equipment as well as a complete control system for the entire plant.
Supporting local development
As a State Owned Enterprise, Semen Indonesia is well aware of its responsibilities in enabling local development in Indonesia. According to Ari Wardhana, in addition to helping to stabilise domestic cement prices, Semen Indonesia has an important role to play in building the nation’s infrastructure: “As a company, we create a huge multiplier effect, especially in the local area near the factory. For example, in our Tuban factory, where we have 900 Semen Gresik employees, we can create more than 7000 jobs related to production, which increases individual wealth and provides more local government income. At Rembang, of the 5149 people involved in the project, approximately 1500 were employed from the local Rembang area. So this is a huge increase in job creation.”
But with this local development, there can be resistance among local communities. Semen Indonesia is working hard to engage the local community, says Ari Wardhana: “In the local communities, some people support the development, while others are against it. We believe that the plant will contribute to the wealth at a community and individual level.”
FLSmidth has supplied supervisors who are helping with the installation of the Rembang plant, which is being constructed by Semen Indonesia. Both parties agree that the construction project is progressing smoothly. This is partly because of the familiarity between the two companies, explains Klaus Bøgeskov Hansen, Project Manager at FLSmidth:
“The teams from FLSmidth and Semen Indonesia are the same teams that worked on the Semen Gresik’s Tuban plant (Line 4), so everyone is very aware of the mutual expectations and ways of working. Our joint teamwork is very productive and we are very good at working together to find solutions to any challenge that arises.” - Klaus Bøgeskov Hansen, Project Manager, FLSmidth
Ari Wardhana is pleased with the partnership with FLSmidth: “Semen Indonesia as a group has worked with FLSmidth since the commissioning of our oldest plant in Padang in 1910. They are always within reach if we have a problem with production or if we need to revamp an existing plant. Their professionalism and honesty always impresses me, and in my experience, FLSmidth does what they can to solve any challenge we meet.”
The Rembang project is not without some infrastructure challenges, however, due to its location. Ari Wardhana explains that although the project is similar to the Tuban 4 project, Rembang is a greenfield project located 120 kilometres from the Tuban workshops from where they would normally receive technical assistance: “Due to the distance, we cannot always get the necessary assistance from our Tuban workshops during installation. This means we need to project manage very carefully in order to ensure correct quality and tolerances of locally fabricated parts.”
Other infrastructure challenges include the need for better road access and a long-term power supply solution. Local planning permission is also required for an overland conveyer belt over the four kilometres between the plant and quarry.
But according to Ari Wardhana, progress in these areas is being made and the plant is expected to be commissioned by the end of 2016.