Antam uses own funds for early stages of new plant construction

PT Aneka Tambang (Antam) will use its own funds and parts of loan from state owned Bank Mandiri for the construction of the publicly listed general mining company?s third ferro nickel processing plant FeNi III until the disbursement of the foreign loan from a syndicate of European banks, Bisnis Indonesia reported on Monday.

Antam?s President Director Dedy Aditya Sumanegara said in Jakarta on Saturday that the internal funds that had been allocated by the company for the construction of the new plant reached between US$50 million and US$60 million while the loan committed by Bank Mandiri totaled about US$75 million.

"We will use the combination of internal funds and Bank Mandiri?s loans to finance the cost for the early stages of the new plant?s construction," he said, adding that loans to be provided by the consortium of the German banks would be used to finance the final stages of the construction.

A consortium or German banks comprising of IKB Deutsche Industriebank AG, Kreditanstalt fur Wiederaufbau (KfW), Commerzebank AG and ING BHF-Bank AG has agreed to provide between US$240 million and US$255 million in loan to finance the construction of Antam?s third smelting plant.

According to Dedy, the construction of the third smelting plant would last for 31 months and the commercial production is expected to begin by the end of 2005. The plant is designed to double nickel production capacity. After the new plant is operated, Antam?s ferronickel output is expected to reach between 2% and 3 % of the total world?s production.

Dedy said that the new plant would increase Antam?s potential income of US$100 million a year. (*)