Asia Pulp to expand operations

Asia Pulp to expand operations

NEW YORK (Reuter): Asia Pulp & Paper Company Ltd said on Thursday it would install three new paper machines at its mills in Indonesia, build a pulp mill in Malaysia and expand its operations in China.

Two paper machines costing US$300 million each would be installed at Asia Pulp's publicly listed subsidiaries, PT Indah Kiat Pulp & Paper Corp and PT Pabrik Kertas Tjiwi Kimia, the company said in a statement.

These machines each had production capacity of 425,000 tons and were set to come on line in the 1998 third quarter.

In Malaysia, Asia Pulp's 60 percent-owned Borneo Pulp & Paper planned to spend about $1.1 billion to build a pulp mill with capacity of 750,000 tons per year, the company said.

This was still subject to final approval from the Malaysian government and was due to start production in the first half of 1999, it said.

Asia also said a wholly owned subsidiary in China planned to install a converting facility with an annual capacity of 100,000 tons at a cost of about $27 million.

The Yalong Paper Products Co Ltd facility in Yushan Town, China was due to start commercial production by mid-1997, the company said.

Indonesia-based PT Pindo Deli Pulp & Paper Mills, 83.6 percent-owned by Asia Pulp, was also planning to expand its tissue paper production capacity by 70,000 tons by installing a machine costing about $125 million, the company said.

This machine would begin commercial production in the first quarter 1999, it said.

Asia Pulp & Paper company had annual sales of about $2 billion last year, it said.