KS delays construction of US$450m steel plant until 2010

Steel producer PT Krakatau Steel (KS) will delay the construction of a steel plant with a capacity of one million ton worth US$450 million in South Kalimantan until 2010, Bisnis Indonesia reported Monday.

 

The decision was made because KS lacks funds and it is not yet ready to form a strategic alliance with global steel producer.

 

KS’s president director Daenulhay asserted that the company would concentrate on completing the construction of a medium-scale plant with a capacity of 300,000 tons. “We delay the mega project worth US$450 million. We want to be slow but it is still scheduled,” he said.

 

The construction of the steel plant with a capacity of 300,000 tons is expected to start in March 2008, he said.

 

Earlier the government urged the management of KS to complete the construction of two steel plants with a capacity of 300,000 tons and one million tons respectively this year in order to reach the 2009 target. (*)