Dayaindo Plans $250m on New Facilities
Elizabeth Gloria Brahmana
Coal and nickel miner Dayaindo Resources International plans to spend up to $250 million this year on new transportation and smelting facilities, a top official says.
President director Sudiro Andi Wiguno said the company planned to build a coal terminal in Belang Belang, West Sulawesi, estimated to cost $150 million and a nickel smelter plant in Cilegon, Banten, forecast to cost $100 million.
Sudiro said the company has about $100 million on hand from its Rp 1.85 trillion ($198 million) rights issue in 2010. Dayaindo was seeking another $150 million, possibly from bank loans, he said.
The company has secured $65 million in rupiah- and dollar-denominated loans from several banks including Bank Negara Indonesia, Bank CIMB Niaga and an affiliate of the Islamic Development Bank Group, Sudiro said. The balance will come from a possible partnership and bank loan from China.
“So far, from the total investment for $150 million for the coal terminal in Belang Belang, we have spent $40 million,” Sudiro said.
To build the nickel smelter in Cilegon, Dayaindo has purchased 15 hectares and taken in a partner from China.
Sudiro said the smelter would produce products made from nickel, including cutlery. Dayaindo expects nickel production from the plant to initially reach 1,500 tons per month and increase to 3,000 tons per month at a later stage. He did not give a time frame for the increase.
The company has one nickel mine in Central Sulawesi, with proven reserves at 30 million tons and production capacity at 100,000 tons of nickel ore per month.
Meanwhile, the company is aiming to achieve coal sales this year of 3 million metric tons, matching last year’s production volume. The company has four coal production blocks across South Kalimantan and Central Kalimantan, it had previously told the Indonesia Stock Exchange. The company is aiming to increase revenue to Rp 1 trillion this year from last year’s Rp 939 billion.
Nickel is among the minerals being banned by Indonesia in its raw form from 2014. The move has prompted Japan to consider lodging a complaint on the policy to the World Trade Organization.
Dayaindo’s shares closed unchanged at Rp 50 at the Indonesia Stock Exchange on Friday.