Bonto-Adhikarya to build railway line

JAKARTA (JP): Local contractor PT Bonto Buleang Utama signed a cooperation agreement yesterday with state-owned construction company PT Adhikarya to build a US$300-million railway to transport coal in East and South Kalimantan.

The construction is scheduled to start in August this year and take two years to complete, Bonto president Andy Z. Ansar Sufajar told reporters.

He said the project was owned by Newman, an American infrastructure company, which had signed a build-operate-transfer contract with the government.

But he did not know how long Newman would operate the railway for until it had to transfer it the government.

Andy said Newman had chosen Bonto as the contractor for the project and Bonto later asked Adhikarya to jointly develop the project.

"We chose Adhikarya as our partner because we think this company is well-experienced in construction," Andy said.

According to Andy, the 125-kilometer railway will connect the two main coal ports in East Kalimantan -- Tanjung Batu in Samarinda and Kariangau in Balikapapan -- passing close to all the main mining sites in East and South Kalimantan.

He said the railway would facilitate the transportation of coal from both provinces' hinterland to the two ports.

At present miners in both provinces mainly move their coal on small ships via rivers to Tanjung Batu and Kariangu, whence the coal is shipped to its next destinations.

The transportation becomes difficult when river water levels drop during dry season.

"The railway network will make the transportation of coal much, much easier," Andy said, adding that the loading capacity of each of the two coal ports would be increased to 300,000 tons from 60,000 tons each at present.

Andy said the development of the railway would require 400 workers and Bonto would use local materials.

The idea of building the railway network was hatched four years ago by then director general of mines Kuntoro Mangkusubroto, who is now mines and energy minister, he said.

Indonesia produced 51.4 tons of coal in 1996/1997, 42 percent of which was exported.

Coal is mined in Central and South Sumatra and South and East Kalimantan.

The majority of the country's mining companies currently operate in Kalimantan which has better-quality coal deposits than Sumatra. Most coal from Kalimantan is exported.

Big coal companies operating in South and East Kalimantan include PT Arutmin Indonesia, PT Utah Indonesia, PT Adaro Indonesia, PT Kaltim Prima Coal, PT Kideco Jaya Agun and PT Tanita Harum. (jsk)