PRESS RELEASE: Antam?s FeNi I nickel smelter to close temporarily due to damaged furnace, FeNi II running normally

PT Antam Tbk (ASX ? Atm; JSX ? Antm) announces today the temporary closure of its first ferronickel smelter, FeNi I, following an accident at 11.00 p.m. on July 17, 2001 at its Pomalaa nickel facility in Southeast Sulawesi, lndonesia. A technical problem within the electric furnace shell caused a burst, which damaged the furnace cover, although the exact extent of the damage is still being determined. The furnace cylinder was undemaged yet repair to the smelter smelter will be necessary and production from FeNi I has currently been halted.

On factory worker suffered burn injuries and is currently being treated in a Makasar hospital. No environmental damage occurred as a result of the accident.

The accident apparently occurred due to a water leak from the furnace cover beam, which is used to support the brick insulation of the cover. Water that becomes trapped beneath calcine (hot ore) can create volatile condition. The interior of the furnace can reach temperatures exceeding 1000 degrees centigrade. The precise cause of the accident is currently being investigated.

The duration of the FeNi I stoppage and the expected production decrease is still being determined. The cost of repairing the smelter is also not yet known and depends on the extent of the damage to the cover, which will either be repaired or replaced. According to the contingency plan, Antarn wifl consider using an air-cooled furnace cover should it require replacing.

The FeNi I and II smelters hold All Risk insurance from PT Asuransi Parolamas for both Property Damage and Business Interruption. It is anticipated that Antam will recover its material and revenue losses within 6 months. Representatives from the insurance company are to fly to Pomalaa today.

Antam will endeavor to accommodate the needs of its valuable ferronickel costumers as it makes every effort to normalize production. In terms of revenue, Antam will explore the possibility of increasing sales of its other commodities.

Following a thorough investigation, Antain will consider what preventative measures if any are required.

Contact: Dohar Siregar, corporate secretary, tel: +62-21-7805119, email: corsec@antam.com (*)