UT may spend Rp 2t for capex

JAKARTA: Publicly listed PT United Tractors (UT), a heavy equipment unit of diversified group PT Astra International, may spend around Rp 2 trillion (US$204 million) in capital expenditures (capex) next year, primarily for expanding its mining activities.

The money will be mostly allocated for buying heavy equipment and spare parts to support the activities of its mining contractor subsidiary PT Pamapersada Nusantara (Pama), UT corporate secretary Chandrawati Waas said over the weekend.

"About 20 percent of the capex will come from our internal cash, while the remaining 80 percent will be from bank loans," she said, adding that the investment would help the company meet next year's revenue target of around Rp 13 trillion.

In 2004, Pama secured a secured a 10-year exploration contract worth $1 billion in 2004 from PT Kaltim Prima Coal (KPC) to mine coal at its site in Bendili, East Kalimantan.

Pama currently holds similar exploration contracts with PT Adaro Indonesia -- the country's largest coal producer -- state- owned PT Tambang Batubara Bukit Asam, PT Indominco Mandiri, PT Multi Harapan Utama and PT Kideco Jaya Agung.

Publicly listed Astra International controls 58.4 percent of UT. During the first nine months of this year, UT recorded a consolidated net revenue of Rp 9.78 trillion, or 46.4 percent higher than Rp 6.68 trillion recorded in the same period of last year. -- JP