Chandra Asri Group's Contribution In Supporting Indonesia Through Shell Energy And Chemicals Park Acquisition

Photo: Doc. Chandra Asri Group

JAKARTA - PT Chandra Asri Pacific Tbk (Chandra Asri Group), a leading provider of energy, chemical and infrastructure solutions in Indonesia, has mapped out potential contributions to national interests through its partnership with Glencore plc through the acquisition of Shell Energy and Chemicals Park (SECP) in Singapore.

Chandra Asri Group and Glencore have signed a Sale and Purchase Agreement with Shell Singapore Pte. Ltd. to acquire all of its holdings at the SECP, which is still awaiting regulatory approval which is expected to be completed by the end of 2024.

President Director & CEO of Chandra Asri Group Erwin Ciputra stated that every business decision taken by the Company aims to provide benefits for Indonesia.

"Chandra Asri Group is committed to becoming a growth partner for Indonesia. A strategic step to acquire SECP assets is one of our contributions to the development of local industries and Indonesia's economic growth. In addition, this acquisition is in line with Chandra Asri Group's growth strategy to go global, expand our business in the energy, chemical and infrastructure sectors not only in Indonesia but also abroad," he said, in a written statement, Friday, October 4.

This corporate action aims to support Indonesia in increasing energy security and meeting increasing demand for chemical products. Through the SECP, which is one of the largest oil refineries and trade centers in the world, the Chandra Asri Group will provide petroleum products, including gasoline, jet fuel, oil gas, and ministitutions to support various industries in Indonesia.

In addition, the Chandra Asri Group will help fill the supply shortage of chemical products, such as MEG, polyol, as well as ethylene, propylene, and styrene monomers, to support the manufacturing process in the country. This will ensure that the country's energy supply remains secure and reduces dependence on foreign entities.

This acquisition is expected to have a positive impact on the Indonesian economy. The proceeds obtained from the SECP will be repatriated and reinvested for domestic industrial development, which will make a significant contribution to national tax revenues, both from corporate taxes and individual taxes," Erwin explained.

Erwin further explained that this expansion will create new job opportunities in the country because a new company will be established to manage SECP support operations. This operation will simplify the process, improve efficiency, and create jobs in various sectors.

"With a focus on operational excellence and innovation, this new company will strengthen its value chain, contribute to Indonesia's economic growth, and ensure the benefits are felt by the community," he explained.

The expansion of the Chandra Asri Group in the ASEAN region is also very important to increase economic efficiency. With the projection of the Compound Annual Growth Rate (CAGR) of 4.5 percent in 2024 and the Joint GDP which is estimated to reach around 4.5 trillion US dollars by 2030, ASEAN offers significant opportunities for Indonesian businesses.

This growth rate shows a strong and dynamic market where Indonesian companies can build a stronger presence. By leveraging strategic partnerships, investing in innovative practices, and increasing operational capabilities, the Chandra Asri Group can effectively utilize diverse markets within ASEAN. This expansion will contribute to Indonesia's overall economic development, enabling Chandra Asri Group to compete more effectively in the global market.

In addition to the economic aspect, this partnership is expected to encourage collaboration and share knowledge through the best practice exchange. The SECP has advanced technology and innovation, managed by experienced professionals, which will facilitate knowledge and technology transfer. On the other hand, the Chandra Asri Group, with a manufacturing experience of more than 32 years, can provide valuable insights and operational expertise to strengthen both sides.

The best practice exchange between SECP and Chandra Asri Group will allow both companies to optimize their processes and capabilities.

In addition, collaboration with Glencore, one of the world's leading natural resource companies, will further encourage innovation, ensuring that this partnership remains competitive in the global market. This synergy is also expected to improve Indonesia's position on the global stage, demonstrating the ability of our country to lead the latest industrial practices.