August 20, 2008

Indonesian Companies to Build Three Iron Ore Plants in South Kalimantan

Excerpt from report in English by influential Indonesian newspaper The Jakarta Post English-language website on 18 August

[Article by Mustaqim Adamrah: "Iron strength in metals leads to three new ore plants in Kalimantan"]

Three companies plan to build iron ore plants worth a combined USD 300 million in investment in South Kalimantan, in an attempt to meet rising global demand for the product.

The three are PT Meratus Jaya, PT Semeru Surya Steel and PT Mandan Steel, Department of Industry and Trade Director I Gusti Putu Suryawirawan said on the weekend [16-17 Aug 08].

"Meratus and Mandan will respectively build a USD 60 million and a USD 220 million plant in Tanah Bumbu District, while Semeru will build a USD 40 million plant in Tanah Laut District -all in South Kalimantan," he told The Jakarta Post.

Meratus is a joint venture company co-owned by state-controlled mining firm PT Aneka Tambang and state-owned steel producer PT Krakatau Steel, while Semeru is a subsidiary of steel producer Gunung Garuda Group.

Mandan Steel is wholly owned by a Hong Kong steel manufacturer which imports iron ore from Indonesia, and will be the only foreign company in the Indonesian iron ore processing industry.

Suryawirawan said Meratus and Semeru would respectively produce 315,000 and 300,000 tonnes of sponge iron annually, while Mandan Steel would produce one million tonnes of billet iron each year.

"Mandan Steel does not want to stop at iron ore processing. It wants to produce billet iron," he said.

"Semeru also planned to produce billet iron like Mandan Steel but finally cancelled its plan due to technical constraints."

Meratus is scheduled to start construction in November [2008], he said.

"Mandan will have to wait for (processing plant) designs, being drawn up in [Hong Kong], before beginning construction -likely to take place in February 2009."

"Semeru, which already had a groundbreaking ceremony in December 2007, will soon announce the commencement of its project."

[passage omitted -irrelevant information]

Originally published by The Jakarta Post website, Jakarta, in English 18 Aug 08.

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