Wed, 01 Jun 2011

Palembang, S Sumatra (ANTARA News) - An Indian investment company has signed a cooperation agreement with the South Sumatra provincial administration for building a 270 kilometers railroad from Tanjung Enim to Lampung.

The building of a railroad track from the mining mouth in Tanjungenim to Lampung province is part of the efforts to increase coal production in the province, Governor H Alex Noerdin said in his written address read out by head of the South Sumatra Investment Coordinating Agency here on Tuesday.

In familiarizing the investment implementation in the area, the governor mentioned the readiness of the Indian investment company with PT Abadi Global which is an indication that the investment climate in the province has become increasingly conducive with the support of a number of potential and strategic natural resources.

He said that in building the railroad the Indian investor said that the project would at least increase the coal production capacity by 10 million to 11 million tons per year to more than 35 million tons.

The Indian investor has already prepared at least Rp16 trillion to Rp17 trillion and absorb a workforce of thousands of people, he said.

Governor Alex Noerdin has earlier said that South Sumatra is not only rich with coal deposits reaching 22.24 billion tons or 48.45 pct of the total national reserves, but also have other potential natural resources in the mining sector.

He said the natural resources included 4.18 trillion standard cubic feet of natural gas and 757.4 standard cubic feet of natural oil.

Speaking of the coal production target programmed by the Indian investor the governor said the provincial administration is also constantly trying to benefit from the existing coal resources by development and building infrastructure like a port in Tanjung Api-Api (TAA), including supporting infrastructure like two way railroad from the mining mouth to the port, so that coal production could be boosted to a maximum of 100 million tons per year in stages, he said.

He also hoped investors have started doing business in South Sumatra, it will give a positive effect on the economy in the area, especially opening wide employment opportunities for at least 100 thousand new workers