Antam, UC Rusal agree to develop Indonesia`s bauxite deposits

Jakarta (ANTARA News) - Publicly-listed mining company PT Antam Tbk of Indonesia and UC RUSAL of Russia have agreed to jointly develop bauxite deposits in Indonesia.

Antam President Director D. Aditya Sumanagara and UC RUSAL Director for International and Special Projects Alexander Livshits signed a heads of agreement to that effect here on Thursday in front of President Susilo Bambang Yudhoyono and President Vladimir Putin.

"The joint project with UC RUSAL is another sign of our commitment to increase shareholders` value," Sumanagara said.

Besides Antam`s two other alumina projects -- the Tayan Chemical Grade Alumina project and the Bintan Smelter Grade Alumina project, Sumanagara said he was confident this project would add value to the company`s vast bauxite resources in West Kalimantan.

"It is part of our strategy to create more value from our reserves by increasing processing activities," he said.

Antam and UC RUSAL would explore the possibility of developing bauxite deposits and of building a smelter grade alumina processing plant in West Kalimantan, he said.

Following a feasibility study, the proposed project might process 3.6 million wet metric tons (wmt) of washed bauxite per year into 1.2 million tonnes of smelter grade alumina per year. The initial estimated project cost might be about US$1.2?1.5 billion and Antam was likely to take a 49% stake in this project with UC RUSAL owning the remaining 51%, he said.

He said feasibility studies would be conducted to determine the investment cost, location, technology, environment and other important aspects prior to the initial phase of development.

The project is part of Antam`s strategy to move into value-adding processing activities together with world class partners, such as UC RUSAL, the world`s largest alumina and aluminum producer.

Meanwhile, Antam continues to work on the Tayan Chemical Grade Alumina project with Japanese and Singaporean companies, as well as exploring the possibility of developing a smelter grade alumina project with a Chinese partner on Bintan Island.