Krakatau Steel to boost production<\/p>\n
JAKARTA (JP): State-owned PT Krakatau Steel plans to invest
\nUS$50 million to modernize its cold rolled steel coils plant in
\nCilegon, West Java.<\/p>\n
Soetoro Mangoensoewargo, the president of Krakatau Steel, said
\nTuesday the company would convert the five-stand tandem cold mill
\nto a full continuous mill to increase production.<\/p>\n
\"The project is expected to raise production of cold rolled
\nsteel coils to 950,000 tons a year from 650,000 tons,\" he said.<\/p>\n
The project will involve a consortium of PT Krakatau
\nEngineering Corporation and Clecim of France and is expected to
\nbe completed in two years, he said.<\/p>\n
The conversion is also meant to increase Krakatau's production
\nof thin-sized cold rolled steel coils to 300,000 tons a year from
\n200,000 tons, he said.<\/p>\n
\"With the newly converted mill, we will be able to meet the
\ndomestic demand for iron sheet roofing, and to provide cold
\nrolled tin mill black plate for tinplate material to PT
\nLatinusa,\" he said.<\/p>\n
PT Krakatau Steel also announced its plan to convert its fuel
\nsystem from natural gas to coal, with a capacity of three million
\ntons a year.<\/p>\n
The plan to convert to the fuel system to coal, which will
\ncost $1.5 billion in investment, was prompted by increasing gas
\nprices, Soetoro said.<\/p>\n
\"The conversion will need a big investment because the mill
\nwill need a pollution control device,\" he said, adding that the
\ncost of the project would be paid for with proceeds from the sale
\nof the company's shares to the public in October.<\/p>\n
Soetoro said his company is also studying the possibility of
\nbuilding electro-galvanis and hot-dip galvanis units, each with
\ncapacities over 100,000 tons, to increase production of iron-
\ncoated cold rolled steel coils.<\/p>\n
Iron-coated cold rolled steel coils are used in car
\ncomponents as well as home and office items.<\/p>\n
PT Krakatau Steel, one of the 10 companies under the
\ngovernment's Management Board of Strategic Industries, is one of
\nthe state firms now being prepared to go public.<\/p>\n
Soetoro said the company's net profits decreased 47 percent to
\nRp 129.9 billion last year.<\/p>\n
Production at PT Krakatau Steel, the country's largest steel
\nmanufacturer, decreased slightly to 2.1 million tons last year
\nfrom 2.2 million tons in 1995.<\/p>\n
Its sales decreased to Rp 2.14 trillion last year from Rp 2.22
\ntrillion in 1995.<\/p>\n
Soetoro blamed the decrease on overstocked production in China
\nand the dumping of imported items, which have affected steel
\nprices. (02)<\/p>",
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