Pupuk Kaltim awards contracts<\/p>\n
JAKARTA (JP): State-owned fertilizer company PT Pupuk
\nKalimantan Timur (Kaltim) has signed two agreements to build two
\namonia plants in Bontang, East Kalimantan, expected to cost
\nUS$480 million.<\/p>\n
One of the two agreements, a joint-operation contract, was
\nsigned yesterday by PT Pupuk Kaltim and two Japanese firms,
\nMitsui Co. Ltd. and Tomen Corporation.<\/p>\n
The two Japanese firms will build a plant to produce 2,000
\nmetric tons of amonia a day. Construction of the plant is
\nexpected to cost around $280 million.<\/p>\n
Under the contract, the plant, scheduled to open in 1999, will
\nbe jointly operated for 18 years by PT Pupuk Kaltim and the two
\nJapanese firms.<\/p>\n
PT Pupuk Kaltim president director Syaiful Amir said the plant
\nwould be handed over to PT Pupuk Kaltim after the 18-year
\ncontract had expired.<\/p>\n
\"If the plant makes a big profit, there is a possibility that
\nthe Japanese firms will hand the plant over to PT Pupuk Kaltim
\nafter 16 years,\" Syaiful said.<\/p>\n
Agreement<\/p>\n
The other agreement, between PT Pupuk Kaltim's pension fund
\nfoundation and Parnaraya Group, was signed several weeks ago. It
\nis a joint venture agreement to build another amonia plant in
\nBontang with a daily capacity of 1,500 metric tons.<\/p>\n
This plant, expected to cost $200 million, is scheduled to
\nopen in 1999.<\/p>\n
The joint venture, PT Kaltim Parna Industri, is 10 percent
\nowned by PT Pupuk Kaltim's pension fund foundation and 90 percent
\nby Parnaraya Group.<\/p>\n
Syaiful said the contract with the two Japanese firms was the
\nfirst joint-operation scheme agreement to be signed by a domestic
\nfertilizer company.<\/p>\n
PT Pupuk Kaltim chose a joint-operation scheme because funds
\nwere hard to come by, he said.<\/p>\n
Under both the agreements, PT Pupuk Kaltim will provide the
\nland, workers and operators for the amonia plants. The partners
\nwill pay to build them.<\/p>\n
Parnaraya Group will finance the construction of its plant
\nwith $50 million in equity and a $150 million loan from the
\ndomestic Bank Bumi Daya, said Marihad Simbolon, the president
\ndirector of PT Kaltim Parna Industri.<\/p>\n
Syaiful said 70 percent of the amonia from the Japanese firms'
\nplant would be exported, and 30 percent would be used by PT Pupuk
\nKaltim to produce fertilizer. Most of the amonia from PT Kaltim
\nParna Industri's plant would be exported.<\/p>\n
He said the Philippines bought most of Pupuk Kaltim's amonia.<\/p>\n
State-owned oil company Pertamina will supply natural gas to
\nthe plants \"at a price cheaper than in foreign countries, so that
\nthe amonia produced by the plants can compete on the
\ninternational market,\" he said.<\/p>\n
Amonia costs about $200 a metric ton on the international
\nmarket, Syaiful said. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/pupuk-kaltim-awards-contracts-1447893297",
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