Bukit Asam to get US$1.3 billion loan for railway infrastructure

PT Bukit Asam Transpacific Railway (BATR) on Friday has signed an agreement with China Development Bank (CDB) for the provision of US$1.3 billion loan to finance the planned 300 kilometers South Sumatra-Lampung railway project.

?The planned disbursement of the money is part of the financing framework agreement among BATR, CDB and China Railways Group Limited,? President Director of BATR, Rudiantara said on the sidelines of ASEAN business and investment summit in Nusa Dua, Bali.

Rudiantara also said the project was part of an integrated plan consisting of coal mining, coal transportation infrastructure and port logistics with total funding needed for the railway project being $2 billion. Having had secured the 1.3b loan, the balance $700 million would come from equity and shareholders paid-up capital.

The signing ceremony was witnessed among others by chairman of Indonesian Employers Association (Apindo) Sofjan Wanandi and Zhou Hui, the Economic & Commercial Affairs Counselor of China Embassy to Indonesia.

The railway project was expected to start operation at the end of 2015 or April 2006 at the latest by the BATR, a joint venture between Rajawali Group through its subsidiary of Rajawali Asia Resources which holds 80 percent of share with PT Bukit Asam Tbk and China Railway Group Limited holding 10 percent each of the remaining. (*)