New firm to set up copper smelting plant
JAKARTA (JP): An Indonesia-New Zealand joint venture, PT Copper Smelter Indonesia (CSI), is challenging PT Freeport Indonesia to compete on the establishment of the country's first copper smelter plant.
Armand J. Nasution, chief commissioner of CSI, said here yesterday that like Freeport, his company also plans to set up a copper smelting facility in Gresik, East Java, with an investment of US$648 million.
"All things related to preparations of the construction are okay. We are just waiting for approval from President Soeharto on our planned project," he said.
A similar project has been planned by Freeport, an Indonesian- American venture, in cooperation with Japan's Nippon Mining, Metallgesselschaft AG of Germany and an Indonesian company, with a planned investment of $600 million.
Freeport's project, which will be designed to annually produce about 150,000 to 200,000 tons of copper, is now facing a possible delay due to a financial fiasco at Metallgesselschaft.
Freeport and Rio Tinto Minera of Spain, both subsidiaries of the American mining company Freeport-McMoRan Copper & Gold Inc., have reportedly planned to take over the German consortium to act as major shareholders in the Gresik project.
Nasution said that any cooperation with Freeport to construct its copper plant will be welcome. "But, we are now ready to go ahead with our existing partners."
He said partners in CSI include Brierly Investment Ltd., Southpac Corporation Ltd., both of New Zealand, Universal Securities of Monaco and a local company, PT Citra Pertiwi Centra.
Nasution said CSI's board of directors will be led by Soeparno Prawiroadiredjo, a former director general of basic metal, machinery and electronic industries.
Overdue
Nasution said the operation of a copper smelting plant in Indonesia has been long awaited by industrial firms using copper as raw material, such as those producing cables and electronic goods.
He said CSI's plant will produce 150,000 metric tons of refined copper a year.
The company will import copper concentrate and other materials as its feedstock from Papua New Guinea and Australia.
He said that his company has even applied to the Ministry of Mines and Energy for a copper mining concession in Irian Jaya. The concession is close to the existing copper mining area of Freeport.
He said that the planned copper smelter project will be constructed by Autocompo of Finland in cooperation with domestic companies, such as state-owned PT Rekayasa Industri, PT Krakatau Engineering, a subsidiary of the state-owned PT Krakatau Steel, and PT Inti Karya Persada Tehnik, a company owned by timber tycoon Mohamad (Bob) Hasan.
CSI is still negotiating with Autocompo on the use of its technology in the copper smelting plant.
"We expect the construction of the project will be completed within 36 months after its approval from the government," he said.
According to Nasution, the Gresik project will also produce 420,000 tons of sulfuric acid, which will be supplied to PT Petro Kimia Gresik, a state-owned petrochemical firm.(fhp)