Trans Pacific to revive Tuban olefins project

Trans Pacific to revive Tuban olefins project

SINGAPORE (Dow Jones): Indonesia's Trans Pacific Petrochemical
Indotama, the joint venture behind the stalled $2.3 billion
olefins project in Tuban, East Java, hopes to reach an agreement
with interested investors by the end of March, and resume
construction sometime in the second quarter of 2000.

According to a company official, who spoke to Dow Jones
Newswires Thursday, "there are some serious investors in the
project, one of whom is Asian."

"Once the new investors are in place, we'll make an
announcement, which shouldn't be too far in the future," he
added.

Construction on the integrated olefins/aromatics project was
halted in late 1997 in the wake of the Asian financial crisis,
when the project was 45 percent complete.

This was despite Tirtamas Majutama receiving a Rp 1.63
trillion (US$226 million) bridging loan from local banks in July
1997 to keep the project afloat.

According to the Indonesian Bank Restructuring Agency, only Rp
600 billion of the total loan was channeled to TPPI.

TPPI is a joint venture between Indonesia's Tirtamas Group,
which holds 65 percent through subsidiaries Trans Pacific
Petrochemical and Tirtamas Majutama; Tuban Petrochemical, a Siam
Cement PCL subsidiary, with 20 percent; and Japan's Itochu Corp.
and Nissho Iwai Corp., and Koch Industries Inc. of the U.S.,
each with 5 percent.