Corporate News in Brief

PETROGRES TO INVEST US$ 760 MILLION. State fertilizer producer PT Petrokimia Gresik (Petrogres) will invest US$ 760 million by phases starting this year to expand its production capacity for urea and other fertilizers. PT Petrogres President Arifin Tasri said in May 2010 Petrogres is carrying out its plan in fuel conversion from oil to coal. The conversion plan will cost around US$60 million and. The conversion will save the company around Rp200 billion a year. Petrogres also will build more tanks for ammonia to facilitate supply of the basic material for urea and NPK fertilizers, the production of which has continued to increase. In line with the revitalization program planned by the government. Petrogres will build urea and ammonia plants to cost around US$500 million to be completed in 2011. The company, however, is still waiting for the guarantee from the government for gas supply. Petrogres also will build a phosphoric acid factory in joint venture with Jordan investors. Arifin said this year the company hopes to increase fertilizer production to 4.2 million tons. The increase in production is expected after expansion of its annual production capacity for NPK to 2 million tons from 1.3 million tons and ZA to 1 million tons from 800,000 tons, Arifin said. The capacity expansion brought its total capacity to 4.2 million tons including urea fertilizer, he said.

CONSTRUCTION OF TWO STEEL FACTORIES IN S. KALIMANTAN TO BE SET EARLIER. The government wants two steel factory projects in South Kalimantan with total investment of US$ 315 million to be fully implemented in 2012 earlier than previous schedule of 2014 . The two projects were planned by PT Mandan Steel and PT Meratus Jaya Iron & Steel. Mandan Steel is owned by a Chinese steel maker China Nickel Resources Holding Co planning to build the upstream steel factory at a cost of US$ 250 million. Meratus is a joint venture between PT Krakatau Steel and PT Aneka Tambang Tbk.planning to build one at a cost of US$ 65 million. I Putu Suryawirawan, the metal director at the directorate general of metal, machine, textiles and multifarious industries, said Mandan Steel would start construction in April 2010; Mandan Steel will build a factory with an annual production capacity of 500,000 tons in the first phase producing special alloy. Mandan Steel will make a contract for the procurement of basic material in the form of iron ore with PT Yiwan Mining and PT Sebuku Iron Lateritic Ore (Silo) in South Kalimantan. Mandan Steel will build the factory in three phases to be completed entirely in 2012 with a total investment of US$1 billion . In 2012, it will have a production capacity of 3 million tons .

BANK MANDIRI TO SPEND US$75 MILLION IN IT. State lender PT Bank Mandiri said it will invest US$ 75 million to improve its information technology infrastructure. The spending is 25% higher than last years' US$ 60 year. Sasmita, the technology director of the country's largest bank in assets, said electronic transactions already made up 82% of its total transactions in 2009, up from 67% in 2008. The users of Internet Banking already reached 1.2 million persons by the end of last year up from 100,000 early that year. Bank Mandiri also plans to increase the number of its automatic teller machines (ATM) by 1,500 units and Electronic Data Capture (EDC) by 60,000 units to increase. By the end of 20`10, the number of its ATMs is expected to reach 6,000 units and its EDC to rise to 90,000 units. Meanwhile, the government said it will study options to increase the public shares in Bank Mandiri that it would be entitled to tax incentives. A bank is entitled to tax incentive if at leats 40% of their share is held by the public. Bank Mandiri is 32.6% owned by the public.

CHANDRA ASRI AND TRI POLYTA EXPANDING CAPACITY. Indonesia's largest petrochemical company PT Chandra Asri said it will start work in its US$ 2.27 billion investment projects this year. Chandra Asri plans to build short term projects and long term projects including BTX extraction, butadiene and naphtha cracker plants and storage tank for liquefied petroleum gas (LPG) and an oil refinery. The naphtha cracker plant and the oil refinery to cost US$ 1 billion each are long term projects, Chandra Asri President Erwin Ciputra said. In the period of 2006-2009, Chandra Asri already invested US$ 160 million to finance debottlenecking of polypropylene plant and construction of an ethylene pipeline and for the acquisition of PT Styrindo Mono Indonesia, a producer of styrene monomer. Meanwhile, associated company PT Tri Polyta Indonesia has started work to build a new production facility valued at Rp300 billion (US$32.5 million). Tri Polyta will expand its annual production capacity for polypropylene (PP) from 360,000 tons at present to 480,000 tons, its President Iman Sucipto Umar said. The new facility of the company which has a 40% share of PP market in the country, is expected to be operational in the first quarter of 2011, Iman said. Iman said the expansion project is to meet growing demand expected to reach 1.1 million tons in 2012. Currently, the country's production of PP averages 650,000 tons a year falling short of requirement of 850,000 tons.

PERTAMINA EYEING ASSETS OF CONOCOPHILIPS. State oil and gas company PT Pertamina said it is ready to take over all assets of ConocoPhilips in the country. ConocoPhilips , based in Houston, Texas, the United States, has announced plan to sell its entire assets abroad. The total assets of ConocoPhilips in Indonesia are estimated to be worth US$ 600million-US$ 700 million. Pertamina Vice President Bayu Kristanto said Pertamina has set aside fund for the take over of the oil and gas related assets. Raden Priyono, the head of the oil and gas regulator BP Migas , said Conoco/Philips' produces 265 MMscfd and 20,000 barrels of crude oil per day from the North Belut gas field in Block B in South Natuna Sea. Meanwhile, French oil and gas company. Total SA said it has been in serious talks with ConocoPhilips on plan to acquire ConocoPhilips stake in the Warim Block in Papua. Total Exploration and Production President Yves-Louis Darricarrere said Total wants to expand its operation to eastern part of the country. Darricarrere said the process of business agreement is expected to be completed this year.