BOSTON—Cabot Corp. has broken ground on an expansion project at its carbon black manufacturing plant in Cilegon, Indonesia.
The first phase of the project will add 80,000 metric tons of annual production capacity to the site, which produces rubber black grades within Cabot's reinforcement business. The product, Cabot wrote in statement, is primarily used for tire applications.
"This is the first phase of our planned expansion in Cilegon, and when all the phases are completed, the total investment will be more than $100 million," Cabot said.
The first phase of expansion is set for completion in 2021.
The new capacity will provide "a reliable, local, high quality supply" to serve the demand in Indonesia and Southeast Asia, which currently is growing at 4-5 percent per year, according to Cabot. It also is part of a global expansion plan launched in 2018 that seeks to address bottlenecking concerns.
At the time the plan was introduced, Cabot said it was expanding its global carbon black manufacturing capacity by about 300,000 tons per year. This capacity increase will enable Cabot to support the growth of its tire, industrial rubber and specialty carbons customers worldwide.
Cabot started its operations in Indonesia 30 years ago and has had close partnership with the Indonesian government through the years.
"Indonesia is determined to be one of the major economic powers in the coming decade, and this investment demonstrates our confidence and commitment to contributing to that goal," said Dixy Olyviardy, managing director of Cabot Asia Pacific South and president of Cabot Indonesia.