Mandala Citra, Beatle to build pure water project
Mandala Citra, Beatle to build pure water project
JAKARTA (JP): PT Mandala Citra, owned by businessman Hutomo (Tommy) Mandala Putra, and Beatle Corporation of the United States, will develop the Umbulan pure water project in East Java with an investment of US$500 million.
The American embassy was quoted by the Bisnis Indonesia daily as saying over the weekend that the East Java provincial administration had approved a proposal from Mandala Citra.
"The two companies are waiting for approval from the Ministry of Public Works to start the project," the embassy said in a statement.
Rachmadi B. Soemadhijo, the director general of housing, planning and urban development at the ministry, however, said his office had not received a request from the East Java provincial administration on the project's new investors.
"We haven't received any request about the new investors. The provincial administration is possibly working on its proposal and may soon present it to the ministry," he said.
The water project at the Umbulan spring is aimed at supporting the industrialization of Madura island.
The Umbulan spring -- which discharges 4,000 liters of water per second -- was offered to private sector developers 10 years ago.
Many private companies expressed interest in the project, but due to a disagreement with the government over water prices, they backed off.
Among the companies initially interested in developing the Umbulan spring were PT Bimantara Sitiwisesa, the Bakrie Group, PT Himpurna Ruba and PT Krakatau Engineering.
Balance
The American embassy said that East Java Governor Basofi Soedirman hoped the ministry would approve Mandala Citra's proposal.
"This project is urgent. Delaying it means denying the East Java community drinking water," insisted Basofi.
Minister of Public Works Radinal Moochtar earlier said the water project was to only support the industrialization of Madura and could not be used for other purposes.
"Investors interested in developing the water project should not expect to use the water for other purposes. It is only for industrialization," he said.
The last investor -- before Hutomo Mandala Putra -- known to be interested in the project was the Ciputra Group.
The director general of the housing, planning and urban development, however, said acceptance of Ciputra's plan was still uncertain. "It will depend on the water tariff proposed by the group," he said.
Radinal said that the developer of the water project should give priority to public interest by minimizing water prices.
"I understand that private companies want to get big profits but they should also take into account the social aspect of the project," he noted.
The government has said it might cut water subsidies, which would increase the price of water by up to 25 percent.
"We will cut the subsidy to strike a balance between the interests of the government, which gives priority to social aspects, and the interests of the private sector, which gives priority to profit," he said. (13)