Mon, 22 Aug 1994

Polyester producers to increase capacity

JAKARTA (JP): PT Indorama Synthetics has assigned five foreign companies to provide technical assistance and plant equipment for its expansion projects which will make it the largest polyester producer in Indonesia.

Under the agreements signed here on Friday, Du Pont of the United States, Chemtex of the United States, Toyobo of Japan, Nissho Iwai of Japan and Barmag of Germany are required to expand Indorama's polyester production capacity from 180 tons per day at present to 420 tons per day by December 1995.

Indorama's president, Vinod Laroya, told reporters that the expansion project will cost US$135 million, which will partly financed by the International Finance Corporation, an affiliate of the World Bank, and loans from a syndication of foreign banks.

Indorama's finance manager, Arvind Parakh, said his company plans to further increase its polyester production capacity by another 240 tons per day by 1997, bringing its total capacity to 660 tons per day.

He added that the expansion of the polyester plant is part of the company's expansion and diversification projects worth $279 million.

The other projects include the expansion of the company's spinning plant, which will cost $10 million, and its weaving plant, that will cost $20 million, he said.

The company will also expand the capacity of its PET resin plant with an investment of $43 million by next year.

Parakh said the expansion and diversification projects will increase the company's total annual sales and profits to Rp 760 billion ($351.5 million) and Rp 100 billion, respectively.

The company's net profit is estimated to increase from Rp 50 billion last year to Rp 60 billion this year, he said.

Korean firm

Meanwhile, PT Sunkyong Keris Indonesia, a South Korean- Indonesian joint venture, said here Friday that it will double the daily production capacity of its polyester plant in Tangerang, West Java, from 90 tons to 180 tons with an investment of $75 million.

A spokesman for Sunkyong Keris, a company jointly owned by the Sunkyong Group of South Korea and the Batik Keris Group of Indonesia, said that construction of the expansion unit will start in November and be completed by December 1995.

The capacity expansion is expected to increase the company's sales revenues by $70 million per annum, he said.

The spokesman said the company's sales reached $100 million last year.

He said Sunkyong Keris will also invest $38 million for the construction of a polyester resin plant with a production capacity of 200 tons per day.

"We will start constructing the polyester resin plant next January," he said, adding that the construction is scheduled to be completed by December 1995.

The operation of the polyester resin plan will likely contribute about $75 million in sales revenues per annum, he said.

Sunkyong Keris exports part of its products to the United States and a number of European and Southeast Asian countries. (05/rid)