RELEASE: Antam to issue US dollar-denominated bond to finance nickel expansion project

Jakarta, May 28th, 2003 - PT Antam Tbk (ASX: ATM, JSX: ANTM) is pleased to announce its intention to issue US Dollar-denominated bonds as part of the optimum combination of debt financing to fund the ferronickel expansion project, FeNi III. Antam plans to use in combination with a loan from Bank Mandiri, which the company will receive in June 2003.

Antam?s President Director, D. Aditya Sumanagara said: ?In consideration of the current strong investor appetite for Indonesian corporate bonds and positive market conditions, we believe using the most favourable combination of a bank loan and corporate bonds to finance FeNi III will provide us with the low cost of debt and stronger cash flows we need to increase shareholder returns?

Antam?s Finance Director, Ki Agus Umar Tochfa commented: ?The decision to issue corporate bonds is part of our ongoing strategy to lower our cost of capital. We also hope to broaden our investor base and increase our profile within the international financial community, which will facilitate our next capital raising exercise.?

Antam?s plan to issue US Dollar-denominated bonds is made in terms of lowering the cost of debt, safeguarding strong cash flows and eliminating currency exchange risk. The US Dollar currency of both the bonds and the Bank Mandiri match that of project revenues and the contract costs.

Antam?s management believes the market will respond positively to the plan, as the company is one of Indonesia?s leading mining companies, with a strong and healthy financial position, indicated by Antam?s credit rating of idAA- by Pefindo, the Indonesian affiliate of S&P. Antam has met with eleven companies seeking to underwrite the issue.

Antam?s plan to issue corporate bonds is associated with modifications to its FeNi III project as announced on April 8 2003 to reduce costs and employ US dollar-denominated Engineering, Procurement and Construction (EPC) contracts. Antam will lower the project costs of the FeNi III project by concentrating on the development of the smelter, while the power plant shall be funded and developed by a third party.

Antam? s previously executed Euro-denominated EPC contracts became null and void after the end of March 2003, as the continued appreciation of the Euro exceeded an agreed to tipper limit. The likelihood of funding the project using export credit financing diminished with the termination of the EPC contracts. The modifications therefore require Antam obtain capital from different sources. The decision to issue bonds is additional to an earlier arrangement for a bank loan from Bank Mandiri. Before the bond is issued. Antam will finalize the new EPC contracts and power purchase agreement. Details of the bond issue will be made available in a forthcoming announcement.

The FeNi III project will more than double Antam contained nickel in ferronickel capacity from 11,000 tonnes to 26,000 tonnes per year. The construction period will last 28 months with commercial operations expected to start in 2006.-End of release.