Ground breaking at copper smelting plant
JAKARTA (JP): Minister of Industry and Trade Tunky Ariwibowo broke the ground in Gresik, East Java, yesterday for the construction of Indonesia's first copper smelter and refinery.
The construction of the plants, owned by a joint venture company belonging to Mitsubishi Materials Corporation of Japan and PT Freeport Indonesia, will be completed in August 1998 and start commercial production in December of the same year.
The joint venture, PT Smelting Company, said that Chiyoda Corporation of Japan has been assigned to construct the plants, which will cost US$600 million.
Smelting Company, set up with an investment of $700 million, is 75 percent owned by Mitsubishi Materials Corp. and 25 percent by Freeport Indonesia, a company majority owned by McMoRan Copper and Gold Incorporated of the United States.
Smelting Company said that Mitsubishi Corporation, the principal company of Mitsubishi Corporation, will be allowed to take a 9.5 percent stake and Nippon Mining & Metals Company Ltd., also of Japan, another 5 percent stake from Mitsubishi Materials Corp.
The joint venture company will have the capacity to annually produce 200,000 tons of copper cathode as its main product, which will be mainly to fulfill Indonesia's domestic demand.
It will also produce four by-products -- 592,000 tons of sulfuric acid, 480 tons of anode slime, 380,000 tons of slag and 31,000 tons of gypsum per year.
For its raw materials, the plants will need 656,000 tons of copper concentrate, 98,000 tons of silica sand, 52,000 tons of limestone and 23,000 tons of coal per year. All the copper concentrate will be sourced from Freeport Indonesia's copper mine in Irian Jaya.
The plants will also need 9,300,000 cubic meters of natural gas per year for fuel.
Minister of Investment Sanyoto Sastrowardoyo said on Wednesday that the operation of the copper smelter will help Indonesia save $270 million for copper cathode imports.
"The joint venture will also help Indonesia earn about $320 million per annum because it will export 67 percent of its output," he said. (13)