Joint venture gas plant to be built in Surabaya in 1995

JAKARTA (JP): Three companies signed a joint venture agreement here yesterday to establish an industrial gas plant in Surabaya, East Java, early next year with a total investment of Rp 29 billion (US$13.4 million).

The agreement was signed by Soemantojo of the state-owned PT Aneka Gas Industri, K. Saitoh of the Japanese Iwatani International Corporation and Rudi G. Endres of the Airgas Incorporated of the United States.

Director General of Chemical Industries Sujata, who witnessed the signing, noted that the agreement shows that Indonesia still offers a conducive foreign investment environment.

"It's in line with the government's effort to attract foreign investment with a series of deregulatory measures to create a more conducive investment climate here," Sujata said.

The plant, to be operated by PT Aneka Iwatani Industrial Gases, is expected to commence commercial operation in 1997, with initial annual production capacity of 24 million cubic meters of liquid oxygen, four million cubic meters of liquid nitrogen, 40 million cubic meters of nitrogen gas and 960,000 cubic meters of liquid argon.

All the products are projected to meet the increasing domestic demand for highly purified industrial gases. Currently the annual capacity of all industrial gas plants in the country is 296.3 million cubic meters.

According to Soemantojo, 64 percent of the total cost of the project will be financed by loans, and the remainder with equity, for which Iwatani will provide 55 percent, Aneka Gas 45 percent and Airgas 10 percent.

Soemantojo noted that although his company is not the majority shareholder, it is entrusted to handle the operation of the plant and the marketing of the products, which are to meet domestic needs. (rid)