FKT Begins Building New Blending Plant

Indonesias PT Federal Karyatama started construction last week on a 100 million liters per year blending plant in western Java that will involve an investment of approximately Rupiah 275 billion (U.S. $23 million).

The plant is being built on about 5 acres of land in the province of Baten, on the Krakatau Industrial Estate Cilegon industrial site in western Java, the company told Lube Report Asia. Set to open in 2017, the new facility will consolidate FKTs two existing plants in East Jakarta, which will be closed in stages.

The new plant is expected to start operations in early 2017 and will use robotics to produce both motorcycle and passenger car oil for domestic consumption. Installed capacity will initially be 100 million l/y andallowing [for] future expansion, said CEO Patrick Adhiatmadja.

Jakarta-based FKTs existing blending plants, which have total capacity of about 45 million l/y, will be closed after production starts at the new plant. As soon as the new factory is operational, we will start shutting down one factory, said Adhiatmadja. And only after the new plant is fully functional and glitch-free, we will shut down the second one.

FKT also has capacity for around 100 million l/y of private-label filling and packaging at its existing pants. The company also has plans to expand blending and bottling facilities in a fourth production line, which would further boost blending and bottling capacity.

The countrys total lubricant market potential is U.S. $1.5 billion per year, according to parent company PT Mitra Pinasthika Mustika Tbks 2014 annual report.

Last September, the company entered the passenger vehicle lubricant market with two new fully synthetic motor oils - Rexton API SN 10W-40 and 5W-30. The company said both products address the risk of engine overheating and use anti-heat active polymer formulation for more efficient operation and engine durability.