THE
COORDINATING MINISTRY FOR ECONOMIC AFFAIRS
Tel: (021) 351-1178 Fax: (021)
351-1186 Website: http://www.ekon.go.id
Trade and
Investment News[1], 2 September 2009
Highlights
National
·
President
to attend G20 summit in
Politics
·
Survey
respondents want non-political cabinet
Terrorism
·
Police,
family link terrorism suspect to al Qaeda
Law & order
·
Provincial
corruption courts to be established under new bill
Health
·
Concern
as swine flu found in South American birds
Economy
·
State-owned
enterprises to tone down demands for high interest rates
Business briefs
Macroeconomy
·
Government
acts to slow price rises
·
New
bond issue as receipts reach 86% of debt target
Investment
·
Nanjing
Iron & Steel plans $1.1 billion steel plant in
·
Nestlé
to spend $100 million to expand milk purchases in
State concerns
·
Wider
role for state logistics agency to combat high prices
·
Indonesia
Eximbank launched to boost exports
SOEs
·
Bank
Mandiri to accept 11% of PT Garuda shares in debt to equity swap
·
Market
capitalization of listed firms doubles in five years
Private sector
·
Lion
Air wins approval to fly to
Banks
·
Healthy
report card for major banks from Fitch Ratings
Power
·
State
power utility looks to build plant at
·
PT
PLN books orders for 1.9 million tons of coal per year
Oil & gas
·
Floating
plant approved for Inpex Timor Sea gas resource
·
Pertamina
boosts output at Java sea block
Mining
·
Churchill
Mining boosts resource estimate to 1.3 billion tons of coal
NATIONAL
President confirms G20 attendance in US
President Susilo Bambang Yudhoyono will attend the G20
Summit in US in September, according to the
State Secretary Hatta Radjasa said the president would
attend the G20 Summit hosted by US President Barack Obama in the city of
"The president will also speak on
Dr. Yudhoyono however will be absent from a UN General
Assembly in New York scheduled for September 21 as he wishes to observe the
Idul Fitri holiday in Indonesia, he said.
Hatta said the president might also conduct bilateral
meetings with leaders from other countries.
POLITICS
Survey
respondents want professional cabinet
The public is hoping the cabinet of the next administration
is made up of professionals and technocrats and not selections based on
politics and religion, according to the results of a poll by the Indonesian
Survey Institute (LSI), The
Asked which were the most important criteria for selecting
ministers in President Susilo Bambang Yudhoyono’s new government, respondents
overwhelmingly avoided politicians and religious figures.
In the poll of 1,270 people, 78.3% of respondents said
professional qualifications were the most important factor for selecting
ministers, rather than their political, religious, ethnic or regional
affiliations.
Only 22.7% of respondents said they believed ministers
should be selected based on their political leanings, according to Dodi
Ambardi, the director of LSI.
The survey was conducted from July 18 to 28 among
respondents selected using multi-stage random sampling techniques. The margin
of error was 2.8 percentage points.
Nearly 74% of respondents who live in provincial villages
and 85.2% of residents in urban areas wanted professionals to sit in the next
cabinet. Only 11.5% of respondents said it was acceptable if ministers came
from certain political parties or religious groups, according to the survey.
Ambardi said that even respondents from Java, home to about
half of the country’s population, viewed professional qualifications as more
important than adhering to the traditional model, which has seen proportional
numbers of Javanese and non-Javanese ministers appointed.
Reports last week quoted insiders as saying election losers
the opposition Indonesian Democratic Party of Struggle and the Golkar Party
will be given ministerial posts, raising fears that politics will trump
professionalism in the composition of the next cabinet.
The overtures to the two parties that fielded alternative
presidential candidates have also upset members of the coalition that backed
Yudhoyono and his running mate, Boediono.
TERROISM
Police,
family link
After several days of silence about the overseas connections
of suspected terrorist Muhammad Jibril, police and a member of his family
confirmed the suspect in the July 17
On Thursday, National Police chief Bambang Hendarso Danuri
said the suspect, a publisher of radical media and Islamist blogger -- known on
the internet as the "Prince of Jihad" -- was once a member of al
Qaeda.
Jibril, also known as Muhammad Ricky Ardhan, was detained on
Tuesday and officially named a suspect on Friday on charges of helping
distribute funds used to finance the
Irfan S. Awwas, Muhammad Jibril’s uncle, said his nephew
attended a traditional Islamic school in
Awwas is the chairman of the Indonesian Mujahidin Council
(MMI), a hard-line group that seeks to implement shariah law throughout the
country and was once chaired by firebrand cleric Abu Bakar Ba’asyir, alleged spiritual
head of the Jemaah Islamiyah regional terrorist group.
Police are investigating Muhammad Jibril’s international
links to the terrorist network of Noordin M. Top.
When asked whether Muhammad Jibril had been involved with
the Al Ghuroba study group in Pakistan, many members of which are suspected al
Qaeda couriers, Awwas did not provide a straight answer.
He asked instead: “What's wrong with joining Al Ghuroba? It
has never been declared as a forbidden organization in
Rusman Gunawan, a member of the Al Ghuroba study group, was
sentenced to four years in prison by the Central Jakarta District Court in 2004
after he was found guilty of assisting terror activities.
Gunawan is the brother of Hambali, a Jemaah Islamiyah leader
currently in detention at
Along with five of his associates, Gunawan was deported from
In addition to arresting Muhammad Jibril, police have also
questioned a Saudi Arabian by the name of Ali Muhammad bin Abdullah alias Al
Khalil Ali, over similar allegations.
Ali has been accused of being an international courier who
helped find donors to finance the activities of the terrorist group led by Top.
Hambali may escape justice over 2002
Hambali, the terrorist mastermind believed to be behind the
Senior
The paper says the news will come as a blow to relatives of
those who perished in the deadliest terrorist attacks ever perpetrated in
While authorities are confident they can tie Hambali to
other terrorist attacks across the archipelago - ensuring he is almost certain
to remain in custody -
Despite the lack of evidence, there is a near universal
consensus among experts, intelligence analysts and government officials that
Hambali was involved in the twin blasts in the Kuta tourist strip.
Hambali, whose real name is Riduan Isamuddin, was arrested
in 2003 in
A senior
As al Qaeda’s chief of operations in Southeast Asia, he is
implicated in a string of attacks across
Hambali was the head of Mantiqi One, the JI cell covering
Indonesian authorities, who also want to prosecute Hambali,
were for the first time granted access to the link man between al Qaeda and JI earlier
this year.
While evidence against Hambali over the 2002 Bali attacks
may be lacking, authorities are believed to have enough evidence to prove his
direct involvement in several other terrorist atrocities in
US military prosecutors have hinted strongly they would seek
the death penalty for Hambali. Former chief prosecutor Col. Mo Davis said in
2007 there was a good chance Hambali would be charged with murder.
LAW & ORDER
Provincial corruption courts to be established: Official
A House of Representatives’ working committee for the
“Each province needs to have its own
Suspects in provincial-level corruption cases will not be
required to go on trial at the
“The District Court head in each province will be appointed
as head of the local
Paproeka said the local graft courts will be established
once the House ratifies the
Last week Paproeka said the working committee would focus on
10 main points in the bill in an effort to pass it before the end of September.
Bribery most common device in graft
Indonesian Corruption Watch (ICW) said Thursday that bribery
was the most popular method of committing corruption between January 2008 and
August 2009, as disclosed by the Corruption Eradication Commission (KPK), Kompas reported.
ICW researcher Febri Diansyah said that 34 of 95 graft cases
stemmed from bribery.
There were also 19 illegal mark-ups, 18 illegal levies, 15
budget misappropriations, eight directly procured appointments and one case of
blackmail.
Bribery constitutes corruption at its initial levels, which
can then develop into acts such as blackmail, which may be committed by
ordinary people and public service officials alike, Diansyah said.
At higher levels, corruption takes the form of nepotism and
cronyism, and extends as far as involvement with business and political mafias,
entrenching itself even with law enforcers and legislators, said ICW
ECONOMY
SOEs agree on 8% deposit interest rate
All state-owned enterprises (SOEs) have agreed to refrain
from asking banks to pay interest of more than 8% on their deposits in a
further bid to lower real interest rates on loans, State Minister for State
Enterprises Sofyan Djalil said, Asia Pulse reported.
The agreement was made in line with Bank
Djalil said the commitment would be realized by maintaining the present SOEs' funds in banks reaching 35% of total deposits.
Djalil spoke after meeting on Wednesday with Finance
Minister Sri Mulyani Indrawati and senior executives of several large state
firms, including PT Telkom, PT PLN and state pension fund PT Jamsostek, The Jakarta Globe reported.
As the primary shareholder of most state-owned firms, the government
was willing to forego revenues from higher deposit rates to encourage banks to
lower lending rates for businesses, which would stimulate the economy, Djalil
said. “The Ministry of Finance also supports the plan,” he said.
BI Senior Deputy Governor Darmin Nasution told a press
conference the deal would strengthen the agreements made with bankers on the
reduction of deposit interest.
Nasution said before that the domination of the largest 1%
of bank depositors, particularly the SOEs, had made deposit interest high,
pushing up loan rates by a similar margin.
In the energy sector, a brawl was brewing between the
government and Mobil Cepu Ltd., a unit of ExxonMobil, with upstream oil and gas
regulator BP Migas stating that it may take the company to arbitration if the
firm fails to produce 15,000 barrels per day (bpd) of crude oil by the end of
August.
State-owned oil and gas company PT Pertamina said on Friday
that it was ready to become the main operator of the Cepu block if asked by the
government, a company official said, The
Jakarta Globe reported.
“If the government made such a decision (to appoint
Pertamina operator), we have enough experience to handle it,” said director
Omar S Anwar.
The block has been producing less than 2,000 bpd but full-fledged
production has not begun because Mobil Cepu has not completed production facilities.
The company has repeatedly said low output was due to difficulties
in land acquisition, which hampered the construction of facilities and
pipelines.
BUSINESS BRIEFS
MACROECONOMY
Govt. aims to mitigate price rises in September: Minister
Inflation will rise at a faster pace in September due to the
Muslim holiday season but the government will work to mitigate price rises,
Finance Minister Sri Mulyani Indrawati said Monday, Dow Jones reported.
"Inflation (next month) will definitely rise, but we
will work to ensure it does not increase too much," Indrawati, who is also
acting coordinating minister for the economy, told reporters.
In July, the consumer price index rose 0.45% on the month
and 2.71% on the year - the slowest annual inflation in nine years.
Separately, head of the Central Bureau of Statistics, Rusman
Heriawan, said on Monday that annual inflation in August may be below July's
inflation rate, while month-on-month inflation in August was likely to be
around July's level of 0.45%.
Govt. aims to raise Rp2T at next auction
The government aims to sell Rp2 trillion ($198 million) of
debt at an auction on September 1, after selling Rp3.5 trillion worth of bonds last
week, the Finance Ministry said on Thursday, Reuters reported.
The ministry has already raised around Rp124.5 trillion or
86% of its Rp144.5 trillion gross debt issuance target this year, and is not
seen as under pressure to increase the size of its next debt sale.
The ministry raised Rp3.5 trillion, nearly double its
target, at its last debt auction on August 25, partly boosted by local bank
depositors shifting their funds into bonds after a cap on domestic bank deposit
rates.
Bank
INVESTMENT
Chinese
steel maker Nanjing Iron and Steel Company plans to build an iron making plant
in
Earlier,
Nickel Resources Holdings Co. through PT Mandan Steel, invested $220 million in
the same business in South Kalimantan, he was quoted as saying by Bisnis
On Monday, the regional administration of
Henan Governor Guo Gengmao said the investors include ventures
involving Yongtong Steel and China Nickel Group worth $64 million, and Good Friend
Tire Co. worth $15 million.
Nestlé to invest $100M in E. Java
PT Nestlé
The company will invest $100 million to expand its dairy
cattle farms in cooperation with local farmers in
"The company's total investment in cattle farms will be
three times larger than its first investment in 1975," he added.
The company will also invest in the raw milk processing
industry, Voght said.
Around 30,000 farmers are involved in the dairy cattle
farming partnership with Nestlé, which receives 600,000 liters of raw milk per
day, Investor Daily reported.
National car makers may need $100M investment
Manufacturers of three new national car prototypes might
need a combined investment of $100 million to launch assembly plants to mass
produce three new vehicles - the Tawon, Gea and Arina, the Industry Ministry
forecast, The Jakarta Post reported.
Panggah Susanto, director for land and military
transportation, said Tuesday that each of the three national car owners would
require more than $30 million to build an assembly plant, with a production
capacity of 5,000 to 10,000 units per annum.
He said the vehicles, expected to be priced at around Rp50
million ($5,000) each, were still in the prototype stage and launch schedules
remained unclear.
The four-wheel Gea has been developed and tested by the
producer, state-owned train manufacturer PT Industri Kereta Api (Inka), since
last year.
Inka uses a 500-cc engine developed by the Agency for the
Assessment and Application of Technology (BPPT) after initially planning to use
a Chinese-made engine.
Arina and Tawon are being developed by
The Semarang-based team has produced five designs for the
three-wheel Arina, resembling a bajaj — a motorized pedicab. With a capacity of
three passengers, Arina, powered by a 500-cc gasoline engine, may be suitable
for both carrying goods and passengers.
A production facility for the four-seater Tawon has been built
in Serang, Banten, using capital supplied by a businessman from
BEML Limited,
VRS Natarajan, the chairman and managing director of BEML
Limited, said $44 million had been allocated for construction of a marketing
office and spare parts depot, as well as a product services center in
"Currently,
The expansion is supported by promising heavy equipment
demand for coal mining and construction sectors in
To support the expansion, BEML Limited has established PT
BEML Indonesia.
BEML Limited was formerly known as Bharat Earth Movers. The
group's principal activity is manufacture of mining and construction equipment,
railway rolling stock, defense equipment and trading.
STATE CONCERNS
Bulog to regain control of staple foods
The government will mandate the State Logistics Agency
(Bulog) to control the prices of not just rice, but also several basic commodities
such as sugar and cooking oil, The Jakarta
Post reported.
The plan surfaced after the government failed to prevent a
jump in the price of sugar to Rp11,000 per kilogram from its set retail price
of Rp6,500.
“Sugar has an unhealthy market, but we can fix it through Bulog,”
State Minister for State Enterprises Sofyan Djalil said Friday, adding that the
government was preparing the best mechanisms that would allow Bulog to control
the price of the commodity.
According to Djalil, Bulog secured 14% of national sugar stock
starting this year. However, Bulog could not influence the sugar market because
the bulk of the stock had been sold to private companies.
Djalil suggested that Bulog also be allowed to control the
price of control cooking oil, which tends to fluctuate due to a poor market
system.
“Actually we do not have a distribution network for cooking
oil. Bulog will be able to build up a market network and keep the commodity’s
price under control,” he said.
Indonesia
will this year extend $2.52 billion in trade financing to local exporters to
support trade, Finance Minister Sri Mulyani Indrawati told reporters Tuesday as
reported by Dow Jones.
The
government has also approved a capital reserve of IDR6 trillion for its
newly-created trade financing agency, Indonesia Eximbank, Mulyani said.
Mulyani
said the $2.52 billion trade financing was agreed as part of an initiative by
Group of 20 countries to supply trade finance to importers and exporters.
She said
Bank Indonesia, the government, local banks and the Japan Bank for
International Cooperation will provide facilities to disburse the funds to
domestic exporters.
Mulyani
said the government has also agreed to this year provide an initial capital
reserve of IDR4 trillion ($536 million) for Indonesia Eximbank. The reserve
will be expanded to IDR6 trillion next year using funds from the state budget,
she said.
"It
is planned that Eximbank will improve Indonesia's exports in this time of
global economic weakness," Mulyani said.
Eximbank
will provide export financing, guarantees and insurance either in conventional
or Shariah-based format to small and medium enterprises as well as larger
corporations, Mulyani said.
Indonesia's
imports and exports have both fallen sharply as the global economic downturn
curbs external and domestic demand.
Imports
in June fell 34% on year and exports 27%.
The
government previously signed a deal with Japan Bank for International
Cooperation under which JBIC will this year provide $500 million to Eximbank
for trade finance purposes.
On the
import side, Eximbank will initially prioritize "necessary" imports
such as goods required for infrastructure projects, Mulyani said.
Eximbank,
previously known as Bank Ekspor Indonesia, was earlier this year mandated to
become a dedicated trade finance provider, and is expected to be fully
functional by the end of the year.
GDP from fisheries sector up $7.7B in four years
The fisheries sector's contribution to GDP increased by
Rp76.79 trillion ($7.7 billion) in the last four years from 2005 to 2008, Asia
Pulse reported.
"Contribution from the fisheries sector to the non-oil
sector GDP increased by 8.37%," said Minister of Maritime Affairs and
Fisheries Minister Freddy Numberi.
In 2005 the sector contributed only Rp59.64 trillion, increasing
to Rp136.43 trillion in 2008, he said.
Govt. to introduce tax refunds for foreign tourists
The government plans to introduce a "tax refund"
scheme for foreign tourists shopping in the country as early as next year under
an amendment to an existing law on value-added tax and luxury tax, legislators
at the House of Representatives said, The
Jakarta Post reported.
"We have approved the tax refund (scheme). It will be
applied to foreign tourists coming via air transportation, not sea or
land," Vera Febyanthy, head of the House's working committee on the
amendment, said Tuesday.
She added that the details of the tax refund mechanism would
be elaborated at a later date through government regulations.
The government and House have agreed to approve the tax
refund scheme in a bid to attract more tourists to
Cooperation increased with
An official from the Indonesian Embassy in
Nurwahyudi said officials also discussed plans for the prime
minister of the
SOEs
Bank Mandiri to take 11% stake in Garuda
PT Bank Mandiri, the country’s largest lender, will take an
11% stake in flagship carrier PT Garuda Indonesia under a debt-to-equity
conversion agreed to by all parties involved, including the central bank, the
State Enterprises Ministry said on Friday, The
Jakarta Globe reported.
Under the plan, Mandiri will convert $100 million of the state-owned
carrier’s bond debt into equity, the state ministry’s office said.
State Minister for State Enterprises Sofyan Djalil said the
deal could be concluded before Garuda’s planned initial public offering,
scheduled for the middle of next year.
He said Bank Mandiri would be required to outline a time
frame for selling its shares in Garuda.
The deal will help pave the way for the airline’s long-delayed
initial public offering, most recently rescheduled until June 2010.
All of Garuda’s debt, about $800 million in total, is being restructured
this year.
“We are currently in the documentation process with our
debtors, including Bank Mandiri,” said Eddy Porwanto, Garuda’s chief financial
officer.
“This means that we are talking about details to be put in
the contract. We estimate it will be finalized by the end of the third
quarter.”
On Monday, Garuda chief executive Emirsyah Satar said the
company aims to raise $300 million to $400 million from an IPO.
The flag carrier also aims to start flights to
SOEs’
market capitalization up 100% in five years
The State
Minister for State Enterprises announced Thursday that the market
capitalization of 14 publicly listed state companies had increased to Rp520
trillion ($52 billion) in the first seven months of the year, The Jakarta Post reported.
"The
performance of state publicly listed companies has improved by up to 100% in
the last five years," Sofyan Djalil said.
He said
three big companies - telecommunications company PT Telkom, banking giant PT
Bank Rakyat Indonesia (BRI) and gas producer PT PGN – had contributed the most
to the total market capitalization figure.
The state
companies listed at the Indonesia Stock Exchange control 31.42% of the total
market, Djalil added.
Govt. injects $44M into state ship builder
The government has agreed to inject $44 million into ailing
state-owned ship manufacturer PT PAL
"The finance minister has issued an approval letter and
the money will be disbursed in September after we have finished completing the
necessary paperwork," PAL president director Harsusanto told reporters on
Wednesday.
PAL has been under the care of state asset management firm
PT Perusahaan Pengelola Aset (PPA) since it defaulted on its business
obligations due to mismanagement and currency losses.
The obligations include meeting deliveries of 18 vessels,
including military ones, ordered by domestic and foreign firms in 2006.
PAL
Harsusanto said the fresh funds would assist the company's
internal restructuring and the construction of the ordered vessels, six of
which are to be delivered by the end of the year.
Jasa Marga accepts $300M loan offer
Toll road operator PT Jasa Marga said it has accepted an
offer for a Rp3 trillion ($300 million) loan from a syndicate of three state
banks, Asia Pulse reported.
The loan from Bank Mandiri, Bank Negara Indonesia (BNI) and
Bank Rakyat Indonesia (BRI) will be used to build new toll roads, Reynaldi
Hermansyah, the finance director of the state company said.
Part of the fund will be used to finance the construction of
a 26.5-km toll road between Cengkareng and Serpong via Kunciran in Banten at a
cost of around Rp1.5 trillion, he said.
The company, which raised its toll fees this month, is set
to chalk up Rp3.7 trillion in net income this year, Hermansyah said.
PRIVATE SECTOR
Firms
to go ahead with IPOs as bourse bounces back
Several
companies that previously postponed their entry into the Indonesia Stock
Exchange have reinstated their plans to launch initial public offerings (IPOs)
as the index has risen more than 70% this year, The Jakarta Post reported.
Local
mining contractor Saptaindra Sejati and two state-owned firms — Bank Tabungan
Negara (BTN) and state housing construction firm Pembangunan Perumahan (PP)—
are among those expected to offer their shares to the public through IPOs this
year, a person familiar with the developments said.
Saptaindra,
a unit of PT Adaro Energy, the country’s second largest coal producer, will
carry out an IPO this year after it being delayed since last year, said
Muhammad Hanif, the executive director of Danareksa, which has been appointed
as the underwriter for the IPO.
According
to previous reports, BTN planned to unload 30% of its stake to raise Rp1.5
trillion in proceeds. There are no figures yet published for PP’s proposed IPO.
The
government has repeatedly declared its intention to list steel maker PT
Krakatau Steel and flag carrier PT Garuda
The
government plans to divest a 30% stake in Krakatau Steel and a 30% stake in
Garuda. Combined with the expected proceeds from BTN’s IPO, the government aims
to generate about $1 billion.
Lion Air to fly to
Lion Air has been cleared to fly to the Middle East after aviation
officials from
Herry Bhakti Singayudha, Director General of Civil Aviation
at the Transport Ministry, said his office was only awaiting a certificate from
Lion Air was supposed to have been cleared in June, but
Singayudha said there had been delays in finalizing an agreement with the GACA.
Currently, only state-owned Garuda Indonesia Airlines flies
the Indonesia-Saudi Arabia route.
BANKS
Fitch gives banks healthy report card
London-based Fitch Ratings says
profitability at several of its rated large to mid-sized Indonesian banks has
remained generally strong in 2008 and the first half of this year and
non-performing loans (NPL) are expected to grow only moderately, a statement
from the agency on Tuesday said.
The rated banks should be able to
absorb the increase in credit costs as loan quality deteriorates in 2009 and
possibly into 2010, it said, while the economy as a whole would post positive
but weaker growth, warranting the continuation of the stable outlook on the
banks.
“Nevertheless, the management of
loan quality will remain a major challenge for banks in Indonesia due to the
more volatile operating conditions, poor corporate debt history and the
evolving state of the banks' risk management,” it said.
Results of a simulation showed that
while in general earnings should be adequate to deal with the additional
stresses, results do vary widely among individual banks, with weaker earnings
at some of the mid-sized to smaller banks exposing them to higher capital
impairment risk should operating conditions deteriorate significantly.
Fitch believes that more capital
restorative measures will be desirable and may be necessary to support
expansion plans and provide a sufficient buffer against the generally riskier
conditions in
Mandiri confirms $300M bond issue
PT Bank Mandiri,
The bank hopes to issue the bonds valued at Rp3 trillion
($300 million), Bank Mandiri director Thomas Arifin said.
Mandiri was studying the market conditions and had invited
seven investment banks for selection as the underwriter.
The prospective underwriters are Bahana Securities,
Danareksa Sekuritas, Trimegah Securities, Deutsche Bank AG, Standard Chartered
Securities Indonesia, Barclays Capital and Mandiri Sekuritas.
Mandiri plans to disburse Rp9 trillion in new credit in the
second half of the year to meet its growth target of 16% this year.
By the end of the first half of the year, the bank recorded
Rp181.6 trillion in outstanding credits or an increase of 21.4% year-on-year, Bisnis Indonesia reported.
Panin Bank to issue Rp5T bond
PT Bank Pan Indonesia (Panin Bank) said Thursday that it
will issue Rp1.5 trillion in five-year bonds to strengthen its capital base and
boost lending, Dow Jones reported.
The bank hasn't decided on the coupon rate of the bond.
The issuance will be arranged by PT Indo Premier Securities,
PT Evergreen Capital, PT Bahana Securities and PT Danareksa Sekuritas.
Panin Bank said that it hopes to get the green light for the
fund-raising plan from the Capital Market and Financial Institutions
Supervisory Agency (Bapepam-LK) by September 28, which will allow it to start
marketing the bond from September 30 to October 1, and issue the debt on October
6.
It added that it plans to list the new bond on the Indonesia
Stock Exchange on October 7.
State banks plan single joint ATM card
Four state-owned banks will issue a single ATM card for
millions of their customers, Kompas reported
on Friday.
The banks, Bank Mandiri, Bank Rakyat Indonesia (BRI), Bank
Negara (BNI) and Bank Tabungan Negara (BTN), are grouped under the Association
of State Banks (Himbara).
“There will be no Mandiri, BRI, BNI and BTN ATM cards, but a
Himbara card,” Bank Mandiri president director Agus Martowardojo said.
Martowardojo has not confirmed when the new joint ATM card
will be launched as the plan is still being thoroughly studied including the
application of information technology.
POWER
PLN eyes power plant near Donggi-Senoro LNG project
State power company PT PLN is considering building a power
plant near the Donggi-Senoro LNG project in
"Donggi-Senoro is an opportunity to meet our gas
consumption. We are interested in using the (Donggi-Senoro) gas for our power
plant," Fahmi Mochtar, president director of PLN, told reporters.
PLN may opt to set up a power plant with a minimum
generating capacity of 100 MW near the project as it was cheaper than shipping
the LNG to power plants in Java or
"The gas price will be lower if we build a gas-fired
power plant near the project," he said.
Mochtar also said private fertilizer company PT Panca Amara
Utama (PAU) has expressed an interest in building a plant at the Donggi-Senoro
site and was willing to buy about 100 mmscfd of gas, or half of the total daily
output from the blocks.
PLN buys 1.9M tons coal per year for new power plant
State power company PT PLN has secured 1.9 million tons of
sub-bituminous coal per year for its new coal-fired power plant in
PT Arutmin, a unit of
"First coal delivery started this week. They will
supply the coal for 20 years," Widodo said.
PLN bought sub-bituminous coal of 4,200 kcal/kg gross
as-received (GAR) at Rp389,000 ($38.51) per ton on cost, insurance, and freight
(CIF) basis, he said.
Rembang power plant is one of 35 new coal-fired power plants
being built under the government's crash program to add 10,000 MW of generating
capacity.
Three new coal-fired power plants with total generating
capacity of 1,960 MW are expected to start commercial operations later this
year, including Rembang, which is expected to start in October.
OIL & GAS
BP
Migas approves Inpex plan for floating gas plant
Upstream oil
and gas regulator BP Migas has given final approval to a plan by
“Our
study shows that a floating facility remains the most economically feasible
option,” BP Migas chief Raden Priyono said.
The
government was seeking to avoid the additional cost-recovery payments it would owe
Inpex for an offshore plant but the Japanese energy producer wanted to avoid
land-acquisition problems associated with building an onshore facility.
Priyono
said the government determined that it would be prudent to endorse the offshore
facility.
Inpex
plans to build a $19.6 billion offshore terminal 200 km south of
The Abadi
project will be the country’s second-largest gas project after the BP-led
Tangguh project in
Inpex
signed a 30-year deal in 1998 to develop the field but has made little
progress. In January 2008, the government ordered it to submit a development
plan or face termination of its contract. The company delivered the $19.6
billion plan in June 2008.
Nico
Muhyiddin, Inpex’s planning manager, said the company would receive tenders for
the processing plant in September.
Pertamina unit boosts ONWJ block crude output
PT Pertamina Hulu Energi has increased crude oil output from
the Offshore North West Java (ONWJ) block by an average 4,000 barrels per day
(bpd) since acquiring a stake in the block last month, an official said
Wednesday, Dow Jones reported.
“At one point, the daily peak output was 26,000
barrels," company spokesman Ali Mudakir said.
Mudakir added that the block was producing 21,500 bpd before
the company bought BP Plc's entire stake in BP West Java Ltd., which owns a 46%
interest in the ONWJ block and is the operator.
He said natural gas produced from the block remains at 220
million cubic feet a day.
Crude output from the block is expected to increase, as two
new wells are scheduled to come on stream next year.
PT Pertamina Hulu Energi is a wholly owned unit of
state-owned oil and gas company PT Pertamina.
33 cargoes of LNG to be exported in August
Four cargoes will be shipped from Arun in Aceh to
BP Migas chief Raden Priyono said the LNG from Bontang will
include 20 cargoes to
Tangguh, which is not yet fully operational, is expected to
have a production capacity of 7.6 million tons a year.
MINING
Nine local firms seek BHP coal project
Nine local companies including Medco Energi and PT Adaro
Energi have expressed interest in acquiring BHP Billiton's coal concession in
"We heard that eight to nine domestic companies appear
interested in purchasing BHP's concession… we have not received bids from any
foreign companies as yet," Bambang Setiawan, Director General of the
Energy and Mineral Resources Ministry's division for Coal, Minerals and
Geothermal said.
Setiawan said that the divestiture would be conducted on a
business-to-business basis, between BHP and interested buyers. However, the
government does expect the company to divest locally, he added.
Australia-based BHP, the world's largest mining company, is
in the process of pulling out from
In early June, the company announced its decision to
terminate the development of the Haju trial mine, one of seven mines registered
under the company's Maruwai coal project in
Earlier, state mining company PT Aneka Tambang also said it
is considering acquiring BHP Billiton's Maruwai coal project as it had type of
coking coal that differs from most coal found in
Vale sells 2.1% stake in INCO
Vale SA, the world’s largest iron-ore producer, raised
Rp925.6 billion ($91.6 million), selling 2.1% of unit PT International Nickel
Indonesia (INCO), Bloomberg reported.
Vale sold 205.68 million of the shares through a book-building
process, INCO said in a stock exchange filing in
About 205.68 million of the shares exchanged hands at
Rp4,500 apiece Thursday on the negotiated market, where investors and exchange
members negotiate the price and report it to the bourse, a discount of 6.3%
from INCO’s closing price on Wednesday
Following the sale, INCO is 58.73% owned by Vale, 20.09% by
Sumitomo Metal Mining Co. Ltd. and 21.18% by the public and other shareholders,
INCO said.
INCO also announced the appointment of Mark J Travers as the
company's new commissioner, replacing Marco Pirez at the company's
extraordinary shareholders' meeting Thursday, The Jakarta Post reported.
The meeting also approved the proposed amendments to the
company's internal policy to comply with the stock market's regulation on
public offerings, the company said in a statement.
Churchill Mining upgrades
Coal miner Churchill Mining Plc said its total measured and
indicated resources for the East Kutai Coal project in
Churchill said it was confident that the majority of the
inferred mineral resources could be confirmed.
However, given the extremely large measured and indicated
resource, the company may consider leaving further exploration work on the
inferred tons for a later stage.
The company said its 75%-owned
The project feasibility work is on schedule with about 80%
of the engineering completed to date, and the feasibility study is still
expected to be completed by the end of 2009, the company said.
The
planned increase is in response to an order from the House of Representatives to
increase coal royalties to Rp15 trillion next year, said Bambang Setiawan, Director
General of Minerals, Coal and Geothermal Resources at the Ministry of Energy
and Mineral Resources.
"Output
is targeted to increase by between 10 million and 20 million tons,"
Setiawan added.
In the first half of 2009, coal production reached 122
million tons or about 4.2% higher than the same period last year, according to
the Indonesian Coal Mining Association (APBI).
For the July-December period, APBI chairman Bob Kamandanu
said the country's total production may increase by 5.7% to 128 million tons,
from 121 million tons in the same period last year.
Antam expects 2010 ferronickel output up by 42%
Gold and nickel miner PT Aneka Tambang (Antam) expects 2010
ferronickel output to increase by 42% on year as the company will fully operate
its third ferronickel plant next year, a company executive told Dow Jones Newswires
Wednesday.
"Ferronickel output next year is expected to increase
to 17,000 metric tons from a target of 12,000 tons this year due to the full
operation of Feni3," said Antam president director Alwin Syah Loebis.
He said he also expects the company's gold output to
increase by 60% to up to 4 tons from the 2.5 tons Antam targets this year.
In an effort to diversify its business, the company plans to
acquire stakes in several mining companies later this year, he said, without
elaborating.
Rio
Tinto awaits license to start
Rio Tinto
is awaiting a license from the government to establish a local corporate body
needed to start a nickel mining venture in the country, Asia Pulse reported.
The
establishment of the local corporate body is one of the conditions needed by
Rio Tinto to secure a license for the venture at Lasamphala in Central Sulawesi
and
Rio Tinto
spokesman Budi Irianto said Rio Tinto
Earlier,
Rio Tinto said it would set aside Rp18 trillion ($1.8 billion) for early
investment in the nickel mine.
The
Lasamphala mine is expected to turn out 46,000 tons of nickel metal a year in
the first years of its operation to be increased to 100,000 tons later, Investor Daily said.
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[1] This Trade and Investment News is a publication of the Coordinating
Ministry for Economic Affairs of the Republic of Indonesia. Readers are
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