Japan's Sojitz, Papua New Guinea agree to study gas chemical project

Japan's Sojitz Corp. and the government of Papua New Guinea have signed a memorandum of understanding for a feasibility study on a gas chemical project in Papua New Guinea using locally sourced natural gas as feedstock, the company announced Wednesday.

The study would include, but not be limited to, methanol, ammonia and dimethyl ether, a source close to the company confirmed.

DME can be used as a synthetic fuel for automobiles, agricultural equipment and power generation.

The feasibility study would likely take at least one or two years, but no deadline was set, the source said.

Sojitz has an 85% majority stake in Indonesia's Kaltim Methanol Industri, which runs a 660,000 mt/year methanol plant at Bontang.