Feasibility Study of Transportation of Di-Methyl Ether (DME) as a Product of Coal Gasification through Pipeline

Abstract

DME (Dimethyl Eter) is one of alternative fuel that will be implemented for household in Indonesia. The paper presents the result of economic feasibility study of Dimethyl Ether (DME) transportation from coal gasification from Tanjung Enim DME Plant using pipeline. The research aims to determine the project feasibility by conducting the qualitative and quantitative analysis. The tools that used in this research include PESTEL analysis, Five Porter Forces, VRCN analysis for qualitative analysis. For quantitative analysis, the author use Discounted Cash Flow (DCF) Analysis to analyse the economical feasibility of the project during 20 years of project lifetime. From the qualitative analysis results, it is concluded that DME Pipeline is a very prospective business and will create a competitive advantage for the company, meanwhile from the quantitative analysis, the DME pipeline project is feasible with the result of indicative toll fee value is US$ 0,13/Ton-Km. In the long term, tbe DME pipeline business will create a big impact as new revenue stream and business diversification in the long term.

Keyword: DME, Pipeline, Feasibility, Coal, Gasification