Jakarta, Bangkok tie up in pulp mill

Jakarta, Bangkok tie up in pulp mill

BANGKOK (AFP): Siam Pulp and Paper PLC (SPP) of Thailand has entered into a joint venture agreement with PT Suryaraya Wahana of Indonesia to set up a US$520 million pulp mill in Indonesia, SPP announced yesterday.

The new company, PT Nityasa Prima, is to build its mill in the Indonesian province of East Kalimantan on the island of Borneo, SPP said in a statement. It would have a production capacity of 350,000 air-dried tons a year.

Production is expected to begin in early 1999, with the wood coming from a 104,000-hectare (260,000-acre) forest owned by the Indonesian company's parent organization, the PT Astra International Group, it said.

PT Suryaraya Wahana will hold 60 percent of the new company and SPP 30 percent. Other shareholders will have 10 percent of PT Nityasa Prima, the statement said without identifying them.

Production from the new company is to be sent to Thailand as raw material for the paper industry here and for export to other countries.

The project is the first investment abroad for SPP, which is a subsidiary of Siam Cement PLC, Thailand's largest industrial concern.