RELEASE: Antam enters final stages to begin construction of FeNi III nickel expansion project

Jakarta, August 28, 2003 ? PT Antam Tbk is pleased to announce it has entered final stages to begin construction of its ferronickel expansion project FeNi III. Antam has signed the Engineering, Procurement and Construction (EPC) contract with an unincorporated consortium of Mitsui Co. and Kawasaki Heavy Industries Ltd. from Japan for the development of the smelter. As well Antam is currently negotiating with power plant contractor for the development of the new power plant. Relating to the financing of the FeNi III project, Antam is in the final stage of reviewing all alternatives to seek the best financing method to ensure a decision which best serves the interests of Antam and its shareholders,

Antam has also decided to re-modify the project, by changing the development concept to include investment in both the new smelter and power plant. 1 he decision comes after efforts to secure the electricity supply of the project from an independent power producer (IPP) were prevented by incompabilities in technical and commercials aspects.

Antam?s President Director, D. Aditya Sumanagara commented, ?The FeNi III nickel expansion is a solid project and a key part of Antam?s strategy to be one of the lowest cost producer of nickel in the world and enhance shareholder value. Therefore we must be prudent to ensure that the project will meet Antam?s requirements. The decision to return to build both the smelter and the power plant concept is based on these principles, as well as Antam?s objective to ensure the best interests of its shareholders is served.?

Currently, efforts to obtain the best optimum financing to fund the FeNi III project are well underway with considerable progress in finalizing legal and other documentation. Antam?s management believes prudent measure are necessary to ensure the financing method selected meets all of Antam?s requirements including internal rate of return and feasible return on investments.

The construction of FeNi III project will last 28 months and once operational will more than double Antam?s ferronickel output and is part of the company?s key strategy to retain its low cost competitiveness and pursue a profitable growth. Antam is a vertically integrated mining company with more than 35 years of experience. (End of release)