Krakatau to join Australian project
Krakatau to join Australian project
ADELAIDE (Reuters): The South Australian Steel and Energy Project (SASE) will involve Ausmelt Ltd, Meekatharra Minerals Ltd and two Indonesian companies, the state-owned PT Krakatau Steel and privately-owned PT Maritosa and Coalindo.
Mines Minister Rob Kerin said yesterday while Krakatau remained fully committed to the project, Maritosa was reconsidering its position in the fall-out of the Asian economic crisis.
"They are not really in a position just at the moment to make an absolute out and out commitment that they will be in it right down the line," he said, adding the company would not be involved in the demonstration plant phase.
A A$15 million demonstration plant for the proposed US$500 million South Australian pig iron export project was expected to be completed within a year.
Premier John Olsen said a A$6.5 million Federal research and development grant would enable the plant to be constructed at Whyalla, in the state's north, without delay.
Olsen said the project would be aimed at the Asian market, despite the projected stalling in regional growth over the next two to three years.
"Most people are forecasting a pickup in growth in future: that means a requirement for steel, therefore we can supply that out of outback South Australia," he said.
Kerin said the proposed A$1 billion Alice Springs to Darwin rail link would make a great difference to the bottom line calculations for the SASE project, although how much difference would have to be assessed by a future feasibility study.
"The railway link is very important to this project because it changes the sums," he said.
Kerin said construction of the demonstration plant, capable of producing two tons of pig iron an hour, would begin in about six months and was expected to be completed by the end of 1998.
SASE has estimated the project, which would exploit Ausmelt technology and Meekatharra's coal and iron ore reserves, would produce up to 2.5 million tons of pig iron each year.