E. Kalimantan to become pulp, paper world leader

JAKARTA (JP): East Kalimantan is set to have the world's largest concentration of pulp and paper production in the next five years with the establishment of four more pulp and paper plants in the province.

Heru Basuki, a senior provincial forestry official, said in Samarinda yesterday that the four pulp plants were being developed separately by PT Kiani Kertas -- owned by the country's timber baron Mohammad 'Bob' Hasan -- PT Adindo, PT Sumalindo and PT ITCI Hutan Manuggal.

He said the four pulp plants would be supported by timber estates.

Each company would produce at least 500,000 tons of pulp a year, he said.

He said that Adindo had set up a timber estate, through PT Adindo Hutani Lestari, in Sembangkung, Bulungan regency. So far, 2060 hectares of the planned 130,560-hectare estate have been developed.

Sumalindo's PT Suryani Hutani Jaya has set up timber estates in Kutai covering 15,000 hectares. ITCI Hutani Manunggal has developed 13,160 hectares of estates.

Kiani Kertas, which plans to start producing pulp in April, will get its raw material from PT Tanjung Redeb Hutani's timber estates.

The president of Kiani Kertas, Machnan R. Kamaluddin, said earlier that PT Tanjung was a joint venture between Bob Hasan and PT Inhutani I. Tanjung plans to spend about $216 million developing an 180,000-hectare timber estate.

He said the estate would be 35 percent financed by Tanjung and the 65 percent by reforestation funds from the government.

"The firm will need around $1,200 for each hectare of the timber estate," Machan said.

Since Tanjung will not be able to feed pulp plants until 2001, Kiani Kertas plans to initially process mixed local hardwood at its plant.

Machnan estimated that it would cost US$1.1 billion ( around Rp 2.3 trillion) to build the plant. (09)