Private firm, government to jointly set up pulp plant

Private firm, government to jointly set up pulp plant

JAKARTA (JP): The widely diversified Mercu Buana Group and the state-owned forestry company Inhutani II will establish a new pulp plant in South Kalimantan which is expected to go into operation in 1998.

"Hopefully, we can start constructing the plant this year and expect to begin production in 1998 with a capacity of 2,000 tons per day," the chief commissioner of PT Menara Hutan Buana, a subsidiary of Mercu Buana Group, Wartono Kadri, told The Jakarta Post here yesterday.

Mercu Buana's line of business includes mining, manufacturing, construction, animal husbandry, plantation and trading services.

Wartono said that the planned plant will involve an investment of US$1 billion and will be 60 percent owned by Mercu Buana and 40 percent by Inhutani II.

He pointed out that the pulp mill will be supported by 250,000 hectares of industrial timber estates to be developed around the South Kalimantan city of Batulicin.

"We have thus far planted an area of more than 30,000 hectares," he said.

According to Wartono, the mill will need some 10,000 tons of logs per day that can be supplied by five hectares of timber industrial estates.

But the director of forest industrial estates of Menara Hutan Buana, Djauhari, said that the project is still being negotiated with Inhutani II.

"Perhaps, it will take some time to finalize an agreement on the pulp project with Inhutani II," he said.

Djauhari said the project has yet to be proposed to the Investment Coordinating Board (BKPM).

Until last July, Indonesia's pulp and paper production capacity was only 1.04 million tons per year, while the domestic demand already reached more than two million tons per year. (13)