Tjiwi Kimia to build a 70MW power plant

Pulp and paper producer PT Pabrik Kertas Tjiwi Kimia Tbk will build a power plant with a capacity of 70 megawatt (MW) next year to improve the company?s cost efficiency, Bisnis Indonesia reported on Monday.

The company?s President Director Arman Sutedja said the company was still discussing the design of the plant and other preparation for its construction with the contractor. At present, the company operates three power plants in Mojokerto, East Java, with combined capacity of 140 MW.

Arman said that the company had not decided the amount of investment for the construction of the power plant. ?But in general each 1 MW will cost about US$1 million,? he added.

This year, the company has allocated about $100 million to buy a paper machine (PM) 13 (about $50 million) and to finance maintenance of existing facilities (about $50 million). The new paper machine is expected to begin operation at the end of this month or early next month.

With the operation of a new machine, the production could be increased by between 5 percent and 10 percent to between 1.01 million tons and 1.06 million tons from 961,000 tons last year, Arman added.

Last year, the company?s total sales rose by 2.99 percent to $1.38 billion from $1.34 billion, while net profits increased by 51.19 percent to $70.41 million from $46.57 million.(*)