Antam, Mitsui deal on new smelter plant deadlocked
JAKARTA (JP): Publicly listed state general mining company PT Aneka Tambang (Antam) said on Tuesday it was deadlocked in negotiations with Japanese contractor Mitsui & Co. Ltd. for the construction of its third ferronickel smelting plant in Pomalaa, Southeast Sulawesi.
Antam president Dedy Aditya Sumanegara said the two companies had yet to reach an agreement on financing for the US$250 million project.
Dedy said Mitsui wanted the export credit to be provided by Japanese banks to finance the construction of the smelter and that the loans should be guaranteed by the Indonesian government.
The government has refused to guarantee the loans because if it were to agree with Mitsui's proposal, it would further increase the its heavy foreign debt burden.
"We're still giving Mitsui a chance to propose an alternative financing scheme that is acceptable to us.
"If the deadlock continues, we shall retender the project," Dedy said after the company's shareholders meeting.
Dedy said Mitsui was presenting a new financing scheme to Antam but did not elaborate.
The FeNi III ferronickel smelter will increase the company's ferronickel output to 24,000 tons in 2001 from 11,000 tons at present.
Industrial sources say German company Krupp Tyssen Nirosta Gmbh, backed by several top officials and President B.J. Habibie's son Tareq Habibie, is ready to take over the project if Mitsui fails to make a deal with Antam.
Dedy admitted that Krupp had approached Antam but denied that the company was backed up by Habibie's son.
Australia
Dedy also said Antam had received in-principle approval on May 21 from the Australian Stock Exchange to list its shares there, but the company was waiting for a good time to be listed.
He said security problems being experienced by the company at its gold mine in Pongkor, West Java, could discourage Australians from buying its shares.
"It is only a matter of marketing. The government wants the listing to receive a warm welcome," Dedy said.
Thousands of illegal miners have been mining Antam's gold deposits in Pongkor over the past several months, causing security problems at the mine.
The illegal miners vandalized Antam's facilities late last year, causing the company a Rp 12 billion ($1.4 million) loss.
Dedy said the company's insurance firm had in principle agreed to cover the losses, the exact amount of which are being calculated.
Dedy said Antam's preparation to have the company listed in Australia was continuing, with a road show in Australia to be held shortly.
"We hope everything will go smoothly with the preparation work for the listing so that we can list in Australia as soon as possible," he said.
The shareholders meeting agreed to pay a Rp 103.87 dividend per share, or 40 percent of the company's net profit in 1998.
The company booked a net profit of Rp 319.5 billion in 1998, up 459 percent from Rp 69.5 billion in 1997. (jsk)