Asia Resources: Sponge iron processing plant to operate this year

By Ruli Setiawan

Hong Kong-listed Asia Resources Holdings Ltd said that a planned sponge iron processing plant in Indonesia is expected to start operation before the end of 2014.

The company said in a filing with the stock exchange that on Friday its non-wholly-owned subsidiary in Indonesia, PT Asia Resources Sejahtera (ARS), entered into a Rp 1.85 billion purchase contract with PT Azadirachta Mandiri, an independent third party, to purchase equipment for the purpose of refining iron sand to sponge iron of higher than 75 percent Fe employing direct reduction iron method.

Meanwhile, PT Dampar Golden International, Asia Resources? another indirect non-wholly-owned subsidiary in Indonesia, will supply the iron sand.

?ARS will use the equipment to set up a processing factory which is planned to commence operation before the end of 2014,? Asia Resources said.

The company and its subsidiaries are in the process of applying for the necessary licenses and approval from the relevant authorities in Indonesia for the processing of iron sand and the export of the sponge iron, it said in the statement, but did not provide further details about the planned processing plant and its location.

Editing by Reiner Simanjuntak