Citra Lamtorogung to build $390m toll road in China

JAKARTA (JP): The Citra Lamtorogung Persada Group has signed a memorandum of understanding with China's state-owned Zhanjiyang Expressway Co. (ZEC) to build a US$390 million toll road in China.

ZEC is the sole license holder to build and operate toll roads in China.

"Under the memorandum of understanding, Citra Lamtorogung and ZEC agreed to form a joint operation body to prepare technical and financial resources for construction of the toll road," the group's chief executive officer, Bambang Soeroso, was quoted yesterday by Bisnis Indonesia as saying after signing the deal with ZEC's president, Jiang Shao Qin, in Beijing.

The signing ceremony took place on Thursday at the Indonesia Opportunities exhibition. The Citra Group, controlled by President Soeharto's daughter Siti Hardiyanti (Tutut) Rukmana, was taking part in exhibition.

The planned toll road will stretch 166.34 kilometers to link China's mainland with Hainan Island, which functions as the main seaport for Guang Dong province and three other Chinese provinces. It will be China's first toll road to be built under a build, transfer and operate (BOT) contract.

The Guang Dong administration plans to build 434.4 kilometers of toll roads across the province, including the 166.34-kilometer toll road in Zhanjiyang, which is the only part of the project being offered to foreign companies.

The Zhanjiyang toll road will also shorten the traveling time from Zhanjiyang to Hong Kong and Macao.

Bambang said the Citra Group will not raise the funds for the road project from sources in Indonesia but from the United States, where it previously generated funds for its toll road project in Manila.

On Thursday, the Citra Group also signed a memorandum of understanding with China Jiang He Water Resources Corp. and China Institute of Water Resources and Hydropower Research for the development of a dam and a mini hydropower plant for rural electrification in Indonesia. (jsk)