Analysis Of Economics For Feasibility Study In The Preliminary Design Of A Lactic Acid Factory With A Capacity Of 11,500 Tons/Year In Indonesia
Abstract
The Lactic Acid Factory is designed with a capacity of 11,500 tons per year. The factory is located in the industrial area of Krakatau II Industrial Zone, Tegalratu, Ciwandan, Cilegon City. The company will be established as a Limited Liability Company (PT), with a total of 172 employees. The factory operates for 330 days a year, with a 24-hour production process each day. Lactic Acid is produced by reacting Acetaldehyde Cyanohydrin, Sulfuric Acid, and Water in a Stirred Tank Reactor (R-01) at a temperature of 125°C and a pressure of 1 atm. The reaction is exothermic, so cooling is applied to maintain the reaction temperature. The reactor output consists of a mixture of Lactic Acid, Sulfuric Acid, Water, Acetaldehyde Cyanohydrin, and by-products such as Ammonium Bisulfate. The plant requires a Fixed Capital of IDR 247,578,592,949 and Working Capital of IDR 356,875,821,038. Economic analysis of this Lactic Acid plant shows a pre-tax ROI of 72.7% and an after-tax ROI of 58.2%. The pre-tax Payback Period is 1.2 years, and the after-tax Payback Period is 1.47 years. The Break-Even Point (BEP) is at 35.18% of production capacity, and the Shutdown Point (SDP) is at 13.8% of production capacity. The Discounted Cash Flow (DCF) is 28.53%. Based on these calculations, the pre-design of the Lactic Acid plant is deemed worthy of further consideration.
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