Vladivostok. PT Pupuk Indonesia (Persero) is exploring a strategic partnership to develop a large-scale ammonia and urea production facility in Russia, as part of efforts to diversify supply sources and strengthen the resilience of Indonesia’s fertilizer industry.

The state-owned fertilizer holding company is conducting a joint study on the development of the Nakhodka Fertilizer Plant Phase 2 (NFP-2) in Russia’s Primorsky Krai, a project being developed by Russian holding company JSC Ruschem.

The exploration was formalized through the signing of a memorandum of understanding (MoU) for a joint study on Sept. 3 during the 11th Eastern Economic Forum (EEF) in Vladivostok, Russia.

Pupuk Indonesia President Director Rahmad Pribadi said the cooperation with Russia could provide the company with alternative sources of production and supply, supporting the resilience of Indonesia’s national fertilizer supply chain.

The potential partnership could also give Pupuk Indonesia access to gas-based ammonia and urea production, with competitive feedstock costs and potentially lower environmental impact.

“This joint study is one of Pupuk Indonesia’s long-term strategic options to secure access to feedstock and global production capacity,” Rahmad said.

He added that the initiative is aligned with directions from Danantara, Indonesia’s sovereign wealth management agency, for Pupuk Indonesia to play a greater role in strengthening national food security while expanding its presence in the global fertilizer industry.

Investment and Downstream Industry Minister and Danantara CEO Rosan P. Roeslani said the initiative followed up on a meeting between President Prabowo Subianto and Russian President Vladimir Putin during the 11th EEF.

He said the proposed cooperation could create new global investment opportunities for Pupuk Indonesia while strengthening the country’s access to fertilizer feedstock and supporting the resilience of the domestic industry.

“Pupuk Indonesia’s performance is improving, and the company is becoming increasingly efficient. It therefore has significant potential to invest in Vladivostok and cooperate with Russian partners,” Rosan said.

“We hope this will become a strategic step to strengthen the resilience of our feedstock supply and our national industry.”

Strategic Value of the Partnership

Pupuk Indonesia’s experience in processing natural gas into ammonia and urea is considered an important asset in assessing the potential partnership in Russia.

The company said its expertise is relevant to the Nakhodka Fertilizer Plant, which is designed around natural gas-based production.

NFP is planned as a large-scale industrial complex producing methanol, ammonia and urea in Russia’s Far East. The project, owned by JSC Ruschem, is expected to have annual production capacity of approximately 1.8 million metric tons of methanol, 2 million metric tons of ammonia and 3.5 million metric tons of urea.

The facility is targeted to begin commercial operations around 2030.

Its location also adds strategic value to the potential partnership. Situated in Primorsky Krai and connected to the Pacific through the port infrastructure around Vladivostok, the project could provide Pupuk Indonesia with expanded access to markets across the Asia-Pacific region.

“Vladivostok faces the Pacific, which is a strategic market for Pupuk Indonesia,” Rahmad said.

The location is therefore one of the factors the company is considering as it assesses the potential development of NFP-2 and its contribution to Pupuk Indonesia’s competitiveness and supply-chain resilience.

Comprehensive Project Assessment

The signing of the MoU marks an initial stage in Pupuk Indonesia’s assessment of the potential NFP-2 development.

Under the joint study, the two sides will conduct a comprehensive feasibility study and due diligence process to evaluate the project's potential.

The assessment will cover technical and economic feasibility, feedstock supply certainty, financing structures, project risks, as well as compliance with applicable laws and regulations.

Pupuk Indonesia said the comprehensive approach reflects its commitment to carefully evaluating every potential development opportunity before making investment decisions.

The exploration of NFP-2 forms part of Pupuk Indonesia’s broader efforts to strengthen its position across the global fertilizer value chain while supporting the long-term resilience of Indonesia’s fertilizer supply and, ultimately, national food security.

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