No winner yet in tender to build $2.2b railway in Central Kalimantan

Central Kalimantan Governor Agustin Teras Narang is denying reports that Japan?s Itochu Corporation had been awarded a contract to build and operate a $2.2 billion coal-transporting railway and port project in the province, saying that four finalists remain in the running, with a winner to be selected by the end of the year.

In August, Coordinating Minister for the Economy Hatta Rajasa suggested that Itochu had won the contract, telling reporters, ?we?re right now in the process of finalizing the decision.?

But when asked by the Jakarta Globe on Friday whether Itochu had made a successful bid, Agustin said the tender process for the railway project was still underway, and that no winner had been selected yet.

?I don?t know why Hatta said that,? Agustin said, countering the minister?s claim.

?The final four are an Itochu-Toll consortium, a Drydocks-MAP Resources Indonesia consortium, Bakrie Indo Infrastructure and a Mega Guna Ganda Semesta-led consortium,? Agustin told the Globe.

He said the four were selected based on their expertise and financial backing, as well as technical and administrative criteria.

?In the next phase, the bidders are required to submit a proposal on how will they develop the rail line. These proposals will determine the winner, which we?re expecting to announce by the end of the year,? he said.

The eventual winner will build a 185-kilometer railway from Puruk Cahu to Bangkuang, connecting coal mines and plantations to ports. The winner will also operate the service for 30 years, carrying all coal mined in the region.

?The railway will be built under a build, operate, own and transfer contract. The length of the contract is flexible depending on negotiations,? Agustin said. (*)