Three foreign firms eye to finance Bontang copper smelter project
Thursday, August 28 2008 - 02:02 AM WIB
?We are currently still negotiating the lending facilities with the three companies, which are considering to provide 70 percent of the funds needed to finance the $850 million copper smelter project,? NSC?s director Juangga Mangasi said in Jakarta on Wednesday.
He said that Ayer Logistics had even expressed its commitment to provide the entire funds needed for the project and another $190 million as equity participation.
?Ayer will provide the funds on the condition that it will have a 30 percent stake in the project,? he said, adding that the company promised to provide loans with maturity of 13 years and with a fixed interest rate of 5 percent a year.
In addition to the three companies, he said, Samsung Concentrate and Trading of South Korea had also expressed its keen interest to take part in the project.
Juangga said that the Korean company had requested to take up a 30 percent stake in the project. For this, the company is ready to provide $255 million in equity participation.
The smelting plant which will be built on a 45-hectare site in the Kaltim Industrial Estate will produce copper cathode grade A with an annual capacity of 200,000 tons a year.
According to the initial plan, the construction of the smelter will be begun in the first semester of next year, while the operation is expected to begin by the end of 2011.
PT Freeport Indonesia and PT Newmont Nusatenggara, which operate copper and gold mines in Papua and West Nusa Tenggara respectively, are expected to supply raw materials for the smelter. "We have talked with Freeport but not yet with Newmont. The result of the talk with Freeport is conducive," he said. (*)