Krakatau Steel to team up with Korean firm in S. Kalimantan iron plant project

State owned steel producer PT Krakatau Steel (KS) may team up with a South Korean company in building a US$500 million iron pellet plant in South Kalimantan, Investor Daily reported on Tuesday.

KS's president director DS Daenulhay said in Jakarta Monday that the state owned steel company was still studying the loan facility to be provided by the Korean company to build the iron pellet plant.

He refused to unveil the name of the company. But he said that the company had reached an initial agreement to provide the $450 million of the $500 million in loan needed to build the plant.

Earlier, Daenulhay said that KS will adopt a "business to business" approach in regards to the steel plant construction project in South Kalimantan because its effort to find strategic partners for the project through a tender has failed.

The steel plant construction project cost is estimated to reach around $450 million. The plant will have an output capacity of 1 million tons of iron pellet per year and to produce pig iron of 300,000 tons a year. (*)