CMNP starts Rp 1.3t giant toll road project
CMNP starts Rp 1.3t giant toll road project
SURABAYA (JP): Publicly listed PT Citra Marga Nusaphala
Persada (CMNP) started construction of the 36.6 kilometer toll
road to connect Waru in Juanda to Tanjung Perak in Surabaya
yesterday.
The minister of public works, Radinal Moocthar, inaugurated
the groundbreaking ceremony, witnessed by the minister of
finance, Ma'rie Muhammad.
Total investment for the development of the road is around Rp
1.3 trillion (US$546.21 million). It is scheduled for completion
by 2001.
Citra Marga Nusaphala Persada is a toll operator controlled by
the eldest daughter of President Soeharto, Siti "Tutut"
Hardijanti Rukmana.
Tutut said the development of the road would be done in three
stages. The first stage, 14.4 kilometers long, would connect
Juanda and Waru and was expected to be completed in 1999. The
second stage, 11.1 kilometers long, would link Tanjung Perak and
Kenjeran and was expected to be completed by 2000. The third
phase, 11.3 kilometers long, would connect Tanjung Perak and
Tambak Oso and was expected to be completed in 2001.
However, she said, the accomplishment of the toll road project
would totally depend on the land clearance along the road.
"The land clearance will be coordinated by the Surabaya and
Sidoardjo administrations," he said.
The land clearance is likely to face problems, especially
between Sidoardjo and the eastern part of Surabaya, as people
residing in the area are mostly government officials and do not
want to move.
"Most property developers willing to develop property projects
along the line failed because the people defended their land,"
one property observer told The Jakarta Post.
Director of CMNP, Bambang Soeroso, said the toll road project
would cover around 260 hectares, of which 70 percent had been
provided by the Surabaya administration.
Soeroso said part of the funds to develop the toll road would
be derived from bonds issued by the firm recently and from the
company's retained earnings. He did not mention the amount of the
retained earnings.
CMNP recently issued $125 million Eurobonds in Luxembourg and
Rp 275 billion in Indonesia.
Besides that, he said, the company would also issues rights
shares to help finance the projects.
The toll road project, built under a build-operate-transfer
scheme that will last 32 years, is expected to break even after
22 years of operation.
Tutut said the presence of the toll road was expected to
cater to the fast growing business development in Surabaya, the
second largest business city in Indonesia after Jakarta.
The company's net profit and revenue were Rp 94.58 billion and
Rp 153.84 billion respectively in 1995. (09/nur)