Two Indonesian firms, PT Inerco Global International and PT Artas Energi Petrogas, have signed a cooperation agreement worth Rp5 trillion (around US$324.62 million) to build Southeast Asia's first integrated seamless pipe factory within the Krakatau Steel Industry Complex.
The factory, with an annual production capacity of 250,000 tons, aims to reduce Indonesia's reliance on imported steel pipes worth Rp15 trillion annually. The project aligns with President Joko Widodo's vision of transforming Indonesia into an industrial nation, promoting domestic value addition.
PT Artas Energi Petrogas, an Indonesian seamless pipe manufacturer, plans to increase the domestic component level (TKDN) or local content from the current 43-50% to 95% by reducing raw material imports. The factory's operation is expected to help Indonesia save on foreign exchange and meet the growing demand for seamless steel pipes in the country's oil and gas industry.
This move comes as Indonesia aims to become self-sufficient in seamless pipe production, reducing its reliance on imports and boosting its industrial capabilities in the steel sector.
