Govt studies Inco request to boost output<\/p>\n
Leony Aurora, The Jakarta Post, Jakarta<\/p>\n
The government is considering nickel mining company PT
\nInternational Nickel Indonesia's request to expand production of
\nits giant mine in Soroako, South Sulawesi, to 200 million pounds
\nof nickel in matte by 2009.<\/p>\n
The government's concerns included that the development in the
\ncompany's two other blocks, namely Bahodopi in Central Sulawesi
\nand Pomalaa in Southeast Sulawesi, would stall as it focused on
\nSoroako, said Mahyudin Lubis, director of coal and mineral
\nendeavors at the ministry of energy and mineral resources.<\/p>\n
\"We'd like to approve the expansion, but there have to be
\nbenefits for the areas that are yet to be developed,\" he said on
\nThursday.<\/p>\n
The Indonesian unit of the world's second largest mining
\ncompany Inco Ltd. is seeking to lift production in Soroako from
\nthe current 160 million pounds of nickel in matte to 200 million
\npounds by 2009.<\/p>\n
To support the expansion, the firm wants to build a 350-
\nmegawatt hydro power plant in Karebbe, with an estimated
\ninvestment of US$280 million.<\/p>\n
While Pomalaa has produced ores, and thus brought royalties
\nfor the local administration, Bahodopi, located within Morowali
\nregency, is yet to deliver revenue for its regional
\nadministration.<\/p>\n
Lubis said the local administration had requested that the
\ncentral government find new investors to speed up the development
\nin Bahodopi. \"We couldn't do that as we are bound by the
\ncontract,\" he said.<\/p>\n
Based on its contract, Inco is obliged to submit feasibility
\nstudy results by 2009.<\/p>\n
Inco's director of government relations Sri Kuncoro said the
\ncompany had been conducting advanced exploration in Bahodopi
\nsince last year.<\/p>\n
\"Next year we will conduct bulk sampling,\" he said. \"If the
\nresults turn out to be good, we will proceed with the feasibility
\nstudies.\"<\/p>\n
Lubis said one of the options to give benefits to the people
\nof the area was to establish more community development projects.<\/p>\n
He added that the government was also concerned that the rapid
\ndevelopment of Soroako would cause an oversupply of nickel and
\nsubsequently lower prices.<\/p>\n
Nickel prices surged last year as demand from producers of
\nstainless steel and other alloys in China grew. In 2004, nickel
\nwas priced at $4.88 a pound, up 51 percent from an average of
\n$3.23 per pound in 2003, based on benchmark prices at the London
\nMetal Exchange.<\/p>\n
Inco's net profits rose to $265.1 million in 2004, from $104.2
\nmillion the year before, supported by a 56 percent jump in sales
\nrevenues from $509 million in 2003 to $792.1 million last year.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-studies-inco-request-to-boost-output-1447893297",
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"sponsor": "Okusi Associates",
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