Cnooc Plans $29 Billion South China Sea Exploration

By Wang Ying 

Nov. 24 (Bloomberg) -- Cnooc Ltd. and its partners may spend about 200 billion yuan ($29 billion) to develop fuel deposits in the South China Sea in the nation's biggest push to tap reserves off the coast. 

The investments between next year and 2020 include an estimated 15 billion yuan by parent China National Offshore Oil Corp. to build deepwater drilling equipment, Luo Donghong, chief development engineer at Cnooc's Shenzhen unit, told reporters and analysts on Nov. 22. He didn't name the companies that will partner China's biggest offshore oil producer. 

Rising energy demand in the world's fourth-biggest economy is prompting state-run Cnooc to boost exploration in an area where nations including Vietnam and Indonesia have laid territorial claims. The company will drill twice the depth of its existing wells off the coast of China as its global rivals cut spending after oil prices fell 66 percent from its July record. 

``Huge potential lies untapped for the company in the South China Sea, which is largely unexplored,'' Wang Aochao, a Shanghai-based analyst with UOB-Kay Hian Ltd., said by telephone today. ``The company will need to tackle the relationship between countries well.'' 

The South China Sea, covering 3.5 million square kilometers, stretches from Singapore to the Straits of Taiwan and is a third of the size of China. In July, the Chinese government opposed a plan by Exxon Mobil Corp., the world's biggest oil company, to explore for fuel in the area with Vietnam, saying the project marks a breach of its historical claim to the region. 

Cnooc climbed 2 percent to close at HK$5.16 in Hong Kong trading, while the benchmark Hang Seng Index dropped 1.6 percent. 

Stimulate Growth 

China, the world's second-biggest oil user, is expediting projects including nuclear power plants, gas pipelines and oil refineries to help stimulate the domestic economy and meet future energy demand. The country will overtake the U.S. as the world's biggest oil and gas consumer in about five years, Royal Dutch Shell Plc said in September. 

``The company will maintain its exploration budget for the South China Sea next year,'' Li Fanrong, general manager of the unit of the Beijing-based company, said in the southern city of Shenzhen. ``The investment is only a rough estimate that reflects the immense potential of oil and gas reserves in the area.'' 

Fuel Reserves 

Geological fuel reserves in the deepwater fields of the South China Sea may reach 22 billion barrels of oil equivalent by 2020 and overall annual output may rise to 350 million barrels, Luo said. China may consume 8.2 million barrels of oil a day in 2009, according to the International Energy Agency, the Paris-based adviser to 28 oil-consuming nations. 

China's demand for natural gas is ``huge'' in the coastal provinces of Guangdong, Fujian and Zhejiang, said Li. 

Cnooc and its future partners aim to drill up to 3,000 meters deep in the offshore area by 2020, compared with the current maximum depth of 1,485 meters, said Luo. ``Deepwater is a key area for future incremental reserves,'' he said. 

The actual spending for the South China Sea will depend on other variables including the price of raw materials such as steel, said Li. 

Cnooc's current exploration partners in the South China Sea include Devon Energy Corp., Husky Energy Inc. and Anadarko Petroleum Corp., Luo said. The Chinese explorer will invest $1.04 billion in exploration in 2008 as it aims to at least replace any reserves it depletes, Cnooc said in January. 

The company plans to produce between 195 million and 199 million barrels of oil equivalent this year, compared with last year's output of between 169 million and 171 million barrels, it said then. 

-- With reporting by Winnie Zhu in Shanghai. Editors: Ang Bee Lin, John Viljoen. To contact the reporter on this story: Wang Ying in Beijing at ywang30@bloomberg.net.

Plastic recycling business offers fortune to man who takes all risks

Agnes Winarti, The Jakarta Post, Jakarta | Sat, 11/22/2008 12:52 PM  

Leaving his job as a foreign bank auditor in the capital in 1999, Baedowy set off to explore the unknown world of plastic recycling. 

Feeling uneasy while his seniors and bosses anxiously faced redundancy after their 20 years of service, Baedowy decided to resign after his three years of working. 

"I was frowned upon by my parents," he said, recalling the time he told his parents about his resignation and intention to be go into the "waste business". 

Similar to most people who break into the recycling business, he said he did not start his business out of a concern for the environment. 

"I have to put food on the table for my wife and three children. I was looking for a business that only required a small amount of capital, generated enough money to met my daily requirements and would make me rich in the long run." 

Baedowy found that recycling plastic waste fit his three criteria. 

His business, however, failed in its first year because the plastic crushing machine he bought for Rp 20 million always malfunctioned. 

"During that year, I spent more time fixing the machine than recycling," he said, adding that there were times he regretted resigning. 

But the long hours spent fixing the machine paid off. Baedowy discovered ways to modify the plastic crushing machine, getting rid of its flaws. 

Baedowy also figured out new ways to sort and crush plastic waste. People started to visit his factory in Cimuning, East Bekasi, to seek his advice. 

He said other plastic recycling firms remained silent when he asked them for advice when he started out nine years ago. 

"The experience motivated me to be different. I prefer to welcome queries about my business," he said. 

"The more, the merrier." 

Today, Baedowy employs about 40 workers at his 1,000-square-meter factory and produces four to five tons of plastic scraps and pellets a week. His 60 business partners, from Naggroe Aceh Darussalam to Papua, each produce approximately three tons per week. 

His business partners come from all walks of life, he said, from fresh graduates and the unemployed to cooperatives and state institutions. 

His partners are taught how to manage their recycling businesses and are supplied with a modified recycling machine. They, in turn, sell their products to Baedowy. 

"I am not only giving the fish and the bait, but I am offering the whole pond." 

Baedowy has been exporting plastic scrap and pellets to Guongzhou, China, since 2004. 

"The typical problem with Indonesian plastic scrap and pellets is the quality. Through training, I ensure that all my partners are able to create products of international standard." 

Although his export business has contracted from 60 percent of his total business to 20 percent due to the global financial crisis, he said, he was not worried. 

"Prices can plummet or soar anytime. But as long as there are some margins to take, everything will be fine." 

In his factory, plastic glass scraps are recycled into raffia cord, while plastic pellets from plastic bags and sacks are remade into new plastic bags and sacks. Scraps from plastic bottles are recycled into polyester thread, while plastic pellets from buckets, lubricating oil and shampoo bottles are recycled into brooms, balls and piggy banks. 

He profits at least Rp 500 for every kilogram of plastic waste, which means a weekly production of three tons will bring a profit of Rp 1.5 million per week. 

Baedowy said his business contributed to the environmental campaign to some extent, by urging people to reduce, reuse and recycle. 

"It is important to make more people aware that waste is a profitable business," said the recipient of the government's 2006 Young Initiator Award. 

"That's the only way the green campaign will work here."

Australia, Indonesia to join forces

The Sydney Morning Herald

Australia and Indonesia will join forces to help the region cope better with extreme weather being wrought by climate change and other natural disasters. 

Australia will spend $67 million over five years to help establish a Jakarta-based centre, aimed at reducing the impact of disasters through training in areas of better risk assessment, identifying new threats and improving relief capabilities. 

Prime Minister Kevin Rudd and Indonesian President Susilo Bambang Yudhoyono unveiled the joint strategy on the sidelines of the Asia Pacific Economic Cooperation (APEC) leaders' summit in Lima on Saturday. 

Since the Boxing Day 2004 tsunami, which killed more than 200,000 people in nations ringing the Indian Ocean, Australia and Indonesia have been working together on ways to better deal with the increasing number and severity of disasters. 

In past week alone, Australia has dealt with severe floods and storms in Queensland and the Indonesian island of Sulawesi has been hit by a major earthquake. 

"Not only only do disasters take lives, they take away the livelihoods of survivors," Dr Yudhoyono told reporters. 

"Just this week both Indonesia and Australia experienced devastating calamities." 

The centre is expected to be up and running by April 2009, and will be prepared to deal with the several regional disasters that kill around 10,000 people annually. 

A study by Australia and Indonesia found that half the world's megacities are in locations vulnerable to earthquakes, and issues like climate change, urbanisation and poor land use were exacerbating the impact of other natural disasters. 

"Also our region is subject to intense volcanic activity and now we see the consequence increase storm activity and with greater intensity," Mr Rudd told reporters. 

"With natural disasters, none of us can predict who will be the next victim, who will be hit next and often there is so little notice when they come." 

Mr Rudd said the centre would organise joint exercises to improve operational capabilities between nations and would develop the use of realistic disaster management scenarios. 

It will also aim to better integrate military assets in disaster relief exercises and planning.

 

Nutrition awareness pilot project succeed in educating the poor

The Jakarta Post, Jakarta | Sat, 11/22/2008 12:55 PM  

Residents in Kalibaru, North Jakarta, said a pilot nutrition and health awareness project aimed at abolishing malnutrition helped them understand how to live healthier lifestyles. 

"My family always washes their hands before eating, and I also learned to allocate my money to buy nutritious ingredients rather than spending it on snacks," a housewife, Uus, told The Jakarta Post Friday. 

She was one of the 2,500 Kalibaru residents taking part in the pilot project organized by the Indonesian Poor People's Union (SRMI) and the Directorate of Community Nutrition at The Health Ministry. They launched the project on Oct. 24. 

The pilot project ended Friday in Kalibaru with an event attended by Health Minister Siti Fadilah Supari. 

SRMI executive Marlo Sitompul said the Rp 1 billion (US$83,000) pilot project targeted over 16,000 people in Jakarta's slum areas in 52 subdistricts.

The fund is being used to build communication posts to distribute free nutritious meals every Friday. The fund is also being used to administer one-day intensive training programs to canteen owners at the project's locations on how to properly prepare and cook nutritious meals. 

The trainers are all nutrition experts appointed by the Health Ministry. 

"After the training, I know how to prepare nutritious foods for my family and customers," a canteen owner, Sumini, said. 

Sumini said she learned the proper cooking and food processing methods, including how to make sure the water she used to steam rice was properly boiled. She also learned about balanced diets. 

Despite the positive impacts to the residents' lifestyles, the project experienced some setbacks. Some residents claimed that although their names were on the list of people eligible for free meals, they never received the promised packages. 

"My family never received a free meal, despite the fact that my kids were the first on the list," a resident, Dodo, said. 

She said she expected the project to implement a better distribution system in the future. They really should prioritize the poorer residents, she added. 

Other residents said they also needed free multi-vitamins, especially for babies, the elderly and pregnant women. 

Marlo said the SRMI had done its best to ensure that all listed residents received their free meals, but the project had a limited budget and supply. 

"In some cases, some five-member families only received two boxes of free meals. In such cases, we encouraged the parents to prioritize their children," he said. 

Despite the setbacks, SRMI coordinator Dika M.N. said he hoped that with the pilot project's current success, the Health Ministry would consider putting the project on its agenda and launch it not only in Jakarta, but also in other provinces. 

Five severe malnutrition cases are listed in Kalibaru, according to SRMI. Just last week, 400 toddlers were reported as severely malnourished in Depok, Greater Jakarta. 

In Indonesia, it is calculated that over 4 million children under the age of five were malnourished in 2007. Most malnutrition cases are caused by poverty and the families' inability to provide nutritious food for their children. 

The government has yet to list the actual number of malnourished children in 2008, but according to Ina Hernawati from the Health Ministry, approximately 4 to 5 percent of children under five are malnourished. (hdt)

Lee holds talks with Indonesian president in Brazil

Brasilia  (Antara News) -- South Korean President Lee Myung-bak held unscheduled summit talks with his Indonesian counterpart, Susilo Bambang Yudhoyono, here on Thursday before winding up his four-day official visit to Brazil, Lee`s aides told Yonhap news agency. 

Lee and Yudhoyono discussed ways to deepen bilateral cooperation in energy and resources and agreed to cooperate more closely in overcoming the global financial crisis during their 30-minute meeting at a Brasilia hotel, said the aides. 

The two leaders also agreed to visit each other`s country as soon as possible, they added. 

Lee and Yudhoyono both visited Brazil after attending the Group of 20 financial summit in Washington, D.C., last week. They held their first summit talks on the sidelines of an expanded Group of 8 summit held in Japan in July. 

Lee asked Yudhoyono to support South Korea`s inroads into Indonesia`s defense procurement market and projects for development of oil, natural gas, coal and forests, said the aides. They also agreed to closely cooperate on North Korea`s denuclearization, climate change and other global issues. 

South Korea`s cumulative investments in Indonesia eached US$5.6 billion as of last year, with more than 1,200 Korean companies involved in business activities in the Southeast Asian country.

Indonesia`s batik in great demand at exhibition in Berlin

London (ANTARA News) - Indonesia`s silver accessories and batik products attracted many visitors at the Import Shop Berlin 2008 which was taken part by 540 participants from 60 countries at Messe Berlin exhibition hall, an official said. 

"Visitors are packing the Indonesian pavilion, and showing their enthusiasm toward the displayed handicraft products with traditional patterns and also batik clothes," first secretary dealing with social and cultural affairs at the Indonesian embassy in Berlin, Agus Priono, said here Thursday. 

"Indonesia`s participation in the event has improved which is marked by the increasing number of visitors coming to the Indonesian pavilion and also the increasing transactions taking place during the exhibition," he said. 

According to Agus, almost all the Indonesian participants considered the Berlin exhibition as a promising and effective promotion of their products. 

"Getting enough experience on market potentials in Berlin and the typeps of products which could attract visitors in this year`s exhibition, small-medium entrepreneurs stated their intenion to come again in next year`s Import Shop Berlin 2009," Agus said. 

Visiting Chairman of the People`s Consultative Assembly (MPR)Hidayat Nur Wahid and an entourage also visited the Indonesian pavilion and gave support to Indonesian participants, during their official visit to Germany. 

Agus explained that the event was an annual exhibition themed Global Market, Local products. The first was held 40 years ago and the Germans are always looking forward to visiting it. 

At the event, he said, the organizing committee offered a slogan "Shop Like You`re On a Vacation" to give shopping opportunities to visitors without having to go abroad. 

Agus also said that Indonesia as one of the exhibitors with silver accessories and batik garments of high quality and competitive prices.

RI, Netherlands enjoy a big boom in ties

Veeramalla Anjaiah, The Jakarta Post, Jakarta  | Wed, 11/19/2008 11:16 AM  

The Netherlands and Indonesia have a more than 300-year-old love-hate relationship. But it took a new turn in 2005 when the Dutch government finally expressed regret over its "police actions" in the late 1940s and recognized Indonesia's independence day as Aug. 17, 1945. 

"Our decision to accept Aug. 17, 1945, as Indonesia's independence day in 2005 has changed the direction of our relationship with Indonesia," Dutch Ambassador to Indonesia Nikolaos van Dam told The Jakarta Post in an interview recently at his office in Jakarta. 

Since then, both countries have enjoyed a big boom in their relations. 

Before 2005, the Dutch government recognized Indonesia's independence date as Dec. 27, 1949 -- the day it formally transferred sovereignty to Indonesia. In 1947, the Netherlands deployed its military in Indonesia to suppress the young republic, an action that led to the deaths of thousands of people from both sides. 

Describing the growing ties between the two countries, Van Dam said the mutual trust, friendship and willingness to develop stronger relations had resulted in the unprecedented boom in bilateral relations. 

"More than half of our Cabinet members, including our Prime Minister in 2006, visited Indonesia during the last three years. This shows how important Indonesia is for us in this region," Van Dam, one of the busiest ambassadors in town, said. 

The latest visitor was Dutch Minister of Economic Affairs Maria van der Hoeven, who came to Indonesia last week to inaugurate the Holland Weeks cultural festival. 

With more than 150 staff members, the Dutch Embassy in Jakarta is the biggest Dutch Embassy in the world. 

Van Dam said high-level visits were not a one-sided affair. 

"From the Indonesian side we also have numerous high-level visits to the Netherlands. Now we are waiting for the visit of the Indonesian President (Susilo Bambang Yudhoyono)," he said. 

Trade between the two countries has grown at a tremendous pace over the last five years (see table). 

"Our bilateral trade last year surpassed the US$3 billion mark. Indonesia enjoys a significant and increasing trade surplus with the Netherlands," Van Dam, who speaks fluent Indonesian, said. 

In 2007, bilateral trade surged to $3.25 billion -- a huge jump from $1.77 billion in 2003. In the first seven months of 2008, bilateral trade was valued at $2.54 billion, 52.41 percent higher than the $1.66 billion recorded over the same period in 2007. 

But the growth in trade favors Indonesia, thanks to its strong exports to the Netherlands. For instance, Indonesia exported $2.75 billion worth of goods to the Netherlands and imports $503.99 million goods from there in 2007. 

There is another dimension to the trade between Indonesian and the Netherlands. 

"The Netherlands is a gateway to Europe for Indonesian products. Most of Indonesia's trade to Europe has been through the Dutch port of Rotterdam. Simultaneously, Indonesia is also a gateway to Southeast Asia for our products," Van Dam said. 

In terms of foreign direct investment (FDI) planning approvals, the Netherlands ranked 8th in 2007 with a total investment of $645 million in 57 projects. 

Thanks to historical links and enormous economic potential, Dutch companies have always been attracted to Indonesia. 

"Shell, one of world's leading energy companies, actually originated in Sumatra in 1890. Companies like Unilever, which has huge plants in Indonesia, Philips and other Dutch companies are well-known here," Van Dam said. 

Besides trade and investment, Van Dam went on, Indonesia and the Netherlands enjoyed good cooperation in areas such as agriculture, energy, technology, defense, shipbuilding and tourism. 

Last year, the Netherlands provided $105 million in development assistance to Indonesia for programs covering good governance, education, water management, drinking water, sanitation, improving the investment climate, community development, and rehabilitation and reconstruction of tsunami-affected areas. 

"The majority of the Netherlands' funds are allocated to programs driven by the Indonesian government and channeled through multilateral agencies (the World Bank, the Asian Development Bank and the UN) that are responsible for the supervision, monitoring and coordination," Van Dam said. 

Of these areas, the tourism sector is very important in Dutch-Indonesian relations. 

"Almost a third of Dutch citizens have personal links with Indonesia, and many Indonesians also have close links with the Netherlands," Van Dam said. 

Commenting on the European Commission's ban on Indonesian airlines from EU airspace, Van Dam said the Netherlands was already helping Indonesia improve its air safety. 

"(The ban) was unfortunate. But air safety is everybody's concern. We are currently helping Indonesia improve the safety of air transportation," Van Dam said. 

Though no Indonesian airlines now fly to Europe, the ban does affect the work of many European diplomats. 

"The ban affects relations between the EU and Indonesia. But I use local airlines for my official duties, I don't have any problems with Indonesian airlines," Van Dam said.

PT Arrtu Mega to build US$1.9 bln liquid coal project Jakarta

Jakarta (ANTARA News/Asia Pulse) - Indonesia's PT Arrtu Mega Energi said it will build a US$1.9 billion liquid coal (di-methyl ether) project in Riau in cooperation with state-owned coal mining company PT Tambang Batubara Bukit Asam (JSX:PTBA). 

Arrtu said it has also asked state-owned oil and gas company PT Pertamina to join in the venture. 

Arrtu president Christoforus Richard said 70 per cent of the project funding will be provided by a consortium of foreign and local banks.

Garuda to reopen Denpasar-Brisbane route next month

The Jakarta Post | Wed, 11/19/2008 10:27 PM  

State airline company Garuda Indonesia will reopen the Denpasar- Brisbane route next month, president director Emirsyah Satar said Wednesday. 

Emir said demand for direct flights between the two cities had recovered after plummeting following the 2005 second bombing in Bali, which led to the termination of the route. 

"The three weekly flights can potentially bring tourists to Indonesia, particularly to Bali," he said in Denpasar, as quoted by Antara news agency. 

Garuda currently flies to four cities in Australia with twice weekly flights to Perth, six per week to Sydney and five per week to Melbourne. 

"The total monthly seat capacity to and from Australia currently stands at 28,004 seats. With the Brisbane route, we will add another 3,516 seats," Emir said.

Banks to benefit from oil, gas firms

Alfian, The Jakarta Post, Jakarta | Thu, 11/20/2008 10:42 AM  

In an attempt to help shore up the liquidity of the country's banking sector, upstream oil and gas regulator BPMigas will soon require oil and gas operators to use domestic banks to facilitate their multi-billion operations. 

Included in the domestic banks are foreign banks operating in Indonesia, BPMigas chairman R. Priyono said Wednesday. 

"This policy aims to increase our banks' liquidity. As the oil and gas sectors use many dollars, it will also boost dollar liquidity in our domestic banks. It will have positive effects on our banks' balance of payments," Priyono said during a discussion on the economic crisis and its impact on the oil and gas sector. 

Priyono said the regulation could be put in place as soon as next month and would be mandatory, applying to both national and foreign oil and gas operators. 

"Oil and gas operators must use domestic bank services, otherwise their expenses will not be reimbursed under the cost recovery scheme," Priyono said, adding that BPMigas had the authority to issue such a regulation. 

Priyono said oil and gas operators might spend about US$11.8 billion next year. "We hope all of the transactions for these funds will be through our domestic banks." 

Oil and gas companies spent about $10.56 billion in 2007. As of October this year, they have spent about $9.2 billion. 

The BPMigas proposal received mixed reactions from oil and gas players. 

President of the Indonesian Petroleum Association Roberto Lorato, who was also a speaker in the discussion, said he could not comment on the proposal, saying that investors and the government needed to discuss further on the matter. 

Roberto, however, said oil and gas investors were "starting to feel less comfortable within the last 12 months". 

"They are starting to feel less comfortable, because they perceive a number of changes, or sometimes there are simply rumors about changes to production sharing contracts, about changing part stakes and about changing cost recovery provisions, which are affecting investors comfort on what they have signed for and on what they will get," Roberto said. 

Lukman Mahfoedz, project director at domestic oil and gas operator PT Medco Energy, said that his company had been using domestic bank services and was quite satisfied with them. He went so far as urging domestic banks to also take part in financing investment in the upstream oil and gas sector. 

"Medco plans to spend about $300 million on its projects in 2009. It would be very good if domestic banks could participate in some of these projects." 

With an average capital adequacy ratio (CAR) of about 16 percent, domestic banks are believed to have stronger foundations than they had during the 1997 crisis. However, data from the central bank shows that domestic bank lending for the energy sector is quite small. 

As at the end of August 2008, outstanding loans for the energy sector stood at Rp 41.6 trillion ($4.2 billion), or about 3.5 percent of total bank credits disbursed.

IFC gives $20m loan to coffee farmers

The Jakarta Post, Thu, 11/20/2008 10:32 AM  

JAKARTA: The International Financial Corporation (IFC), a part of the World Bank, has disbursed loans worth US$20 million to a local coffee company, Indo Cafco, for the setting up a number of farmer training centers in North Sumatra. 

The centers are aimed at helping the farmers acquire necessary information on how to produce sustainable coffee products, which will have more added-value and attract premium prices. 

The centers will target 4,500 farmer households working for Indo Cafco in the next four years and an additional 30,000 farmers working outside the company network. 

Indo Cafco, a local unit of Sweden's trading company ECOM Agroindustrial Corporation, is the supplier to Starbucks and Nespresso.

Indonesia is the fourth biggest coffee producer in the world and the second biggest in Asia after Vietnam. 

The program is part of a $55 million loan agreement between IFC and ECOM being implemented in six countries - Indonesia, Vietnam, Papua New Guinea, Kenya, Tanzania and Uganda. -- JP

Lion Air seals $380m deal with ATR for new aircraft

The Jakarta Post, Thu, 11/20/2008 10:35 AM   

Airline company Lion Air signed Wednesday a memorandum of understanding with aircraft manufacturer ATR for an order of 10 ATR 72-500 aircraft and an option on another 10. 

Signed during the opening of the four-day Indo Defense and Aerospace Expo and Forum at the Halim Perdanakusumah Air Force Base in Jakarta, the deal is worth more than US$380 million including the extra options. 

The twin-turboprop, 72-seat aircraft will be operated by Lion Air's subsidiary Wings Air as a feeder service to Lion Air's Boeing 737-900ER twin jets. 

"With our brand new fleet of ATR 72-500s, we will able to develop a strong low-cost network, feeding Lion Air's major hubs," Lion Air CEO Rusdi Kirana said in a press statement. 

ATR CEO Stephane Mayer said the deal would "increase our presence in the expanding Indonesian market and continue the growth of our large fleet in Southeast Asia which has become a booming market in the last three years". 

With the arrival of ATR 72-500s, Wings Air will discontinue the operation of its McDonnell Douglas MD-82 and DHC-8-300 fleets. 

Wings Air's ATR 72-500s are powered by higher power rated PW 127 engines driving six-blade propellers and will be equipped with the Elegance cabin incorporating the latest developments in passenger amenities and comfort. 

The Franco-Italian aircraft manufacturer claims that all ATR models are compliant with noise regulations and have a large margin with regard to Chapter IV (ICAO) noise limits. -- JP/Novan Iman Santosa

Indovision boost subscriber base

The Jakarta Post, Jakarta | Thu, 11/20/2008 10:33 AM  

Satellite television provider PT MNC Skyvision, with its brand Indovision, plans to launch its new satellite in March next year -- called Protostar-II -- to expand services to existing subscribers and attract new ones. 

"We hope to raise the number of subscribers to 1.2 million because of the launch," CEO Rudy Tanoesoedibjo said in a press conference in the Information and Communication Ministry Office on Wednesday. 

Currently, Indovision, which operates a satellite called Indostar-I, has around 500,000 subscribers, comprising both individuals and corporations. 

Protostar-II will have a capacity to transmit about 160 channels, more than three times the capacity of Indostar-I which carries 50 channels. 

"We have invested US$300 million in this new satellite," Rudy said, adding that 40 percent of the required funding was derived from loans. He said up to 100 foreign television stations had already made proposals to rent channels offered by the satellite. 

Protostar-II is currently being made by Boeing Satellite Systems and is a joint project between Indovision and Protostar, an Asian satellite services operator. It will be launched from Baikonour, Kazakhstan, on March 17. 

Indovision has said it expects to earn Rp 1 trillion in sales this year. 

Gatot S. Dewa Broto, spokesperson of the Ministry of Communication and Information, said "We hope that the launching of this satellite will further encourage domestic satellite service users to choose domestic transponders." 

Transponders or transmitter-responders are satellite channel receivers, which receive, amplify and retransmit signals on different frequencies. (dna)

 

Asian countries are largely dependent on US corn imports

BBC

Asian countries are largely dependent on US corn imports 

South Korean firm Daewoo has unveiled plans to plant corn on one million acres of land in Madagascar, to sharply cut its reliance on US imports. 

Daewoo leased the vast tract of land - which is half the size of Belgium - for 99 years and hopes to produce 5m tonnes of corn a year by 2023. 

It will manage the plantations directly and use South African labour. 

Asian countries have been trying to ensure access to food supplies after grain prices soared earlier this year. 

Daewoo will also grow palm oil on another 300,000 acres of land leased in Madagascar. 

The conglomerate is already developing a 50,000 acre corn farm in Indonesia in partnership with South Korea's biggest feed maker, Nonghyup Feed. 

Other countries short of arable land, such as Saudi Arabia and Kuwait, have also been seeking agricultural investments in Africa or Asia. 

And some African countries have expressed interest in receiving foreign investors. 

Angola has offered farmland for development while Ethiopia's prime minister, Meles Zenawi, has said he was eager to see foreign companies take a stake in his country's agriculture.

Related Articles:

Food Estates to be Developed 

Saudi Arabia keen to invest in W Sumatra`s farmland

Yudhoyono : RI, Brazil should help solve global problems

European Union Offer Assistance to Improve Indonesian Aviation

Wednesday, 19 November, 2008 | 17:01 WIB 

TEMPO Interactive, Jakarta: The European Union (EU) is offering to cooperate in order to improve Indonesian aviation. 

Director General of Air Transportation Budhi Muliawan Suyitno said that the EU was now more open. 

“Before, the EU only imposed a flight ban but now its is offering assistance,” he said yesterday (18/11). 

He mentioned that five EU countries are serious about offering technical assistance. 

Germany, France, and the Netherlands will offer assistance for security and safety affairs while Sweden and the UK are offering training for human resources. 

This Friday, Directorate of Air Transportation will have a teleconference with the EU flight safety unit to talk about the progress over Indonesian aviation. 

“It is better to talk through a teleconference so there’ll be no miscommunication,” said Budhi. 

Budhi went on to say that the replacement of the EU ambassador to Indonesia, from Pierre Phillipe to Julian Wilson, will have a positive impact. 

Wilson is a cooperative person with good intentions of improving the relations between both parties. 

Since end of November 2007, the EU has banned Indonesian airlines from flying to Europe. 

The EU said it considered Indonesian airlines did not meet the proper safety standards. 

At an evaluation meeting on July 10 in Belgium, Indonesia offered three options. 

One of these was to encourage Indonesian flight regulators by working together with the International Civil Aviation Organization (ICAO) to improve safety standards. 

Budhi explained the cooperation will be realized soon. 

Five aviation inspectors will be appointed on November 27 when ICAO President Robert Kobeh Gonzales comes to Indonesia. 

In addition, the Civil Aviation Transformation Team (CATT) will also be formed through cooperation between ICAO, the Federation Aviation Administration (FAA-America), and the Civil Aviation Safety Authority (CASA-Australia). 

A representative office for the CATT team will be located at Transportation Department and be responsible to the Director General of Air Transportation. 

VENNIE MELYANI

Food Estates to be Developed

Wednesday, 19 November, 2008 | 17:04 WIB 

TEMPO Interactive, Jakarta: The government will develop food estates in order to increase food production as well as to cover interest in investing in the food sector. 

“We are completing the regulation. Some investors are interested already,” said Bayu Khrisnamurti, a Deputy to the Coordinating Minister for the Economy in the Division of Agriculture and Naval Affairs, at his office yesterday (18/11). 

Bayu cites that matters to be regulated would cover the maximum side of land, the business period, the subsidy usage for entrepreneurs, credit facilities, and the maximum share that foreign companies can own. 

It is expected that the regulation will be completed next year. 

“This is to protect small farmers,” he said. 

GUNANTO ES

WIKA to acquire Citra Insan Pertiwi

The Jakarta Post, Wed, 11/19/2008 10:48 AM  

JAKARTA: State owned construction firm PT Wijaya Karya (WIKA) will spend at least Rp 23 billion (US$1.94 million) to acquire a majority stake in PT Catur Insan Pertiwi (CIP), a mechanical and electrical construction company. 

In a statement on Tuesday, WIKA announced it had acquired 70.08 percent of CIP's shares in a bid to support WIKA's power plants construction projects. 

"We are optimistic that this effort will boost WIKA competitiveness in building power plants. This will support WIKA's margin growth in the future," WIKA's president director Bintang Perbowo said in the statement. 

CIP is a private domestic company focusing on mechanical and electrical construction for power plants projects. By buying the company, WIKA expects to increase its cost efficiency and operational effectiveness. 

WIKA recently won several power plants projects, including Muara Karang power plant in Jakarta; Indramayu and Pelabuhan Ratu power plants in West Java, Labuan Banten power plant in Banten, and several other power plants in Sumatera, Sulawesi and Kalimantan.

KFC to open 40 new stores next year

The Jakarta Post, Wed, 11/19/2008 10:59 AM  

Publicly listed food franchise company PT Fast Food Indonesia plans next year to open 40 new stores for the U.S.-fast food outlet Kentucky Fried Chicken (KFC) in a bid to meet a sales growth target of between 16 percent and 19.6 percent. 

The company said in a statement to the Indonesia Stock Exchange (IDX) Tuesday that it had projected sales to reach Rp 2.42 trillion (US$206 million) next year, up by 30.8 percent from an estimated Rp 202 trillion by the end of this year. 

Currently, Fast Food operates 334 KFC outlets all over Indonesia, more than 60 percent of which are located in cities in Java. It opened 27 new stores so far this year, up to September. 

Fast Food recorded Rp 1.46 trillion in sales revenue during the first nine months of the year, a 31.4 percent jump from Rp 1.11 trillion in the same period last year. 

"The opening of our new restaurants, especially in potential regencies, has boosted our sales growth this year," said the company in a statement to the Indonesian Stock Exchange (IDX). 

Fast Food also said its sales growth was supported by its pricing strategy and the rising value of the KFC brand. Fast Food is 43.8 percent owned by PT Gelael Pratama, 35.8 percent by PT Megah Era Raharja and 20.4 percent owned by the public. (JP/hwa)

PLN to make Rp 1.5t bond offer despite poor market

Alfian, The Jakarta Post, Jakarta | Wed, 11/19/2008 11:09 AM  

Against the backdrop of the global financial crisis that has dried up liquidity in many capital markets, state power company PT Perusahaan Listrik Negara (PLN) remains upbeat on its plan to issue Rp 1.5 trillion ($124 million) worth of bonds next month. 

The bonds are aimed at helping the company finance the construction of its power plants and transmission systems, PLN president director Fahmi Mochtar said on Tuesday. 

The seven-year bonds, Rp 500 billion of which will be in the form of Islamic bonds, would be the tenth bond issue by PLN. 

"PLN has submitted all of the required documents for the bond issue to Bapepam (the Capital Market and Financial Institution Supervisory Agency) and is now waiting for the agency's approval," said Fahmi. 

PLN has appointed Bank Niaga as a trustee agent for the bond issue, with Trimegah Securities, Indo Premier Securities and Danareksa Securities as underwriters. 

PLN may face difficulties in selling its bonds as local bonds are becoming less attractive to foreign investors. 

Bloomberg reported that overseas investors cut their holdings in local bonds to Rp 89.4 trillion as of Monday, from Rp 92.8 trillion at the end of last month. 

Fahmi said PLN was fully aware of the current financial conditions which might influence market appetite towards the bonds. 

"We are fully aware of these conditions. That is why we are not making the issue too big. Previously, we planned to sell Rp 3 trillion worth of bonds, but we have cut this to see how the market will react," he said. 

He also said PLN had annulled a plan to sell Rp 10 trillion worth of bonds in foreign currencies. 

PLN is seeking loans to finance its ongoing massive effort to complete a 10,000-megawat (MW) power plant program to meet the increasingly rapid demand for electricity in the country. 

About 6800 MW of this capacity is to be located in Java and Bali, provided by 10 new power plants, while the rest is located outside the Java-Bali system and will be generated by about 20 smaller power plants. 

To complete the program, PLN needs $4.4 billion and Rp 17.33 trillion to build power stations and $934 million and Rp 13.15 trillion for transmission systems. 

As of October, the company has secured US$1.5 billion and Rp 13 trillion both from local and foreign banks.

Eurocopter to open subsidiary in Indonesia

The Jakarta Post, Jakarta | Wed, 11/19/2008 5:12 PM  

European civil and military helicopter manufacturer Eurocopter is set to expand its global presence by opening a subsidiary company in Indonesia by the end of next year. 

The EADS subsidiary, which was established in 1992 and have operated in Indonesia for the last 30 years, will set up its first Indonesian headquarters in Jakarta and will employ between 70 and 100 workers, according to reports by Kompas.com. 

The local office will cooperate with state-owned aircraft maker PT Dirgantara Indonesia (PTDI) in providing sales and after-sales services to its local customers. 

Eurocopter and PTDI had earlier signed a cooperation agreement for a local helicopter assembly factory for Super Puma MK helicopters in October this year. 

The company has previously secured a production permit for 118 BO 105 series choppers.

 

Indonesian Anti Corruption Body to Coop with FBI

Jakarta (ANTARA News) - The Corruption Eradication Commission (KPK) is to cooperate with the US Federal Bureau of Investigation (FBI) in developing its capability to combat corruption in Indonesia. 

The two bodies` intention to cooperate was formalized in a memorandum of understanding (MoU) signed by KPK Chairman Antasari Azhar and FBI Deputy Director John Pistole here on Tuesday. 

Antasari Azhar said the two institutions had agreed to cooperate in such matters as exchange of information, implementation of corruption eradication programs, training courses, exchange of intelligence and investigation experts, and technical guidance. 

He said the essence of the KPK-FBI cooperation was to develop the KPK`s human resources` competence and quality. 

"FBI will serve as a model for KPK`s development," Antasari said, adding that the cooperation was part of a learning process for KPK about FBI`s organization and working system. 

Meanwhile, FBI Deputy Director John Pistole said FBI`s main business was eradicating corruption committed by state officials. 

He said the KPK-FBI cooperation could eventually be developed into an accord on efforts to achieve recovery from the damage done by corruption such the freezing and returning of stolen assets stashed in the United States. 

Meanwhile, KPK deputy chairman Chandra Hamah said Indonesia and the United States had different legal systems and the KPK-FBI cooperation was intended to bridge those differences. 

He said FBI was the primary investigative arm of the United States Department of Justice (DOJ), serving as both a federal criminal investigative body and a domestic intelligence agency. 

At present, the FBI has investigative jurisdiction over violations of more than 200 categories of federal crimes, making the FBI the de-facto lead law enforcement agency of the United States government. 

The FBI headquarters is in Washington, D.C., and there are also 56 field offices located in major cities throughout the United States as well as over 400 resident agencies in smaller cities and towns across the nation, and more than 50 international offices, called Legal Attaches, in U.S. embassies worldwide.

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Mexico and Indonesia sign oil cooperation deal

Mexico City (ANTARA News) - The presidents of Indonesia, Susilo Bambang Yudhoyono, and of Mexico, Felipe Calderon, signed an oil cooperation agreement Monday involving their two state-run oil companies, Pertamina and Pemex, respectively, the two leaders announced after a meeting. 

The agreement, Calderon was quoted by AFP as telling reporters, establishes "a cooperation framework in the fields of development, scientific and technological investigation, and exploration and drilling ... between Petroleos Mexicanos (Pemex) and Pertamina, Indonesia's oil company." 

Yudhoyono, who arrived here from Washington after attending the Group of 20 economic meeting in Washington over the weekend, said he was also seeking to increase bilateral economic relations between the two countries. 

Calderon, who also attended the G20 meeting, said another cooperation agreement in agriculture, education and diplomatic training was also signed with the visiting president. 

Yudhoyono and Calderon will also travel to Lima for next weekend's meeting of the 21-nation Asia-Pacific Economic Cooperation (APEC).

PLN to Issue Sharia Bonds Worth Rp500 Bln

Jakarta (ANTARA News) - State electricity company PT Perusahaan Listrik Negara (PLN) plans to issue sharia bonds (sukuk) worth Rp500 billion as part of its planned Rp1.5 trillion bond issuance this year. 

The bonds, to be due in seven years, would be the tenth bonds the company would issue, PLN President Director Fahmi Mochtar said on the sidelines of a national coordination meeting of the Indonesian Chamber of Commerce and Industry (Kadin) on energy and mineral resources here on Tuesday. 

PLN has appointed Bank Niaga a trustee agent for the bond issuance with Trimegah and Indopremiere Sekuritas as bond underwriters. 

The company originally planned to issue rupiah-denominated bonds worth Rp3 trillion and dollar-denominated bonds worth US$1 billion (about Rp13 trillion) this year. 

But because of the worsening financial market, it will only issue local currency bonds worth Rp1.5 trillion this year.

Jambi, Aussie investor sign carbon trade agreement

Jon Afrizal, The Jakarta Post, Jambi | Tue, 11/18/2008 9:52 AM  

In a bid to further preserve their area’s forests and increase regional revenue, Jambi’s provincial and municipal administrations signed a carbon trade agreement with an Australian investor last week. 

Jambi Governor Zulkifli Nurdin and Mayor Bambang Priyanto signed the contract on Nov. 12 with Australian consultant Peter N. Kene of International Business Network and investor Charles Jackson of Carbon Strategic Global. 

Zulkifli said the contract would last indefinitely as long as it was mutually beneficial, in line with prevailing regulations and forests were well preserved. 

“So by preserving forests we are making money. We will use the money to improve the prosperity of communities living around the forests,” Zulkifli said. 

The contract covers the carbon value of some 200,000 hectares of forests across the province with a price set at US$10 per ton per year during the first phase, Zulkifli said. 

“The price will be reviewed periodically according to market developments,” he said. 

At the current price, Jambi expects to gain credit for some 100,000 tons of carbon per year, meaning it will earn US$1 million from the forest’s preservation, Zulkifli said. 

“Imagine if the price rises to US$20 or even US$30 per ton per year.” 

Zulkifli was confident the contract would guarantee the protection of the forests because the local community would benefit directly from it. 

He gave his word that the money would be spent to benefit the communities living around the forests, adding that they would no longer need to cut down trees to make a living but preserve them instead. 

“As long as the forests are preserved, carbon is produced. And as long as the carbon is produced, money is also earned,” he said. 

Indonesian Forum for the Environment (Walhi) executive director Arif Munandar said the contract was a step in the right direction. 

On the one hand, he said, forests and whole ecosystems will be well preserved. On the other hand the local administrations will earn rewards from their preservation efforts. 

Arif reminded the local administrations to keep their word regarding the use of money earned from the carbon trading, and to make certain it was for communities living around the forests and not other purposes. 

“It is they who contribute the most to the preservation of the forests ... So, don’t ever forget them,” Arif said. 

He further reminded the local administrations that they needed to work out what they would do with the money, especially to improve the livelihoods of communities. 

Among other means, he suggested, was the establishment an economic institution to help communities become economically independent. 

Arif said local administrations needed to change people’s perspective of forests, so that they see forests as not just a timber resource but having myriad other advantages also. 

“This way we will be able to maintain the beauty of the forests while the community also benefit economically,” he said.

Mexico ready to buy gas, coal from Indonesia

Mexico City (ANTARA News) - Three giant Mexican companies have expressed readiness to buy liquefied natural gas (LNG) and coal from Indonesia, Indonesian Energy and Mineral Resources Minister Purnomo Yusgiantoro said here on Sunday. 

"This is the result of President Susilo Bambang Yudhoyono's one-on-one meeting with the leaders of three Mexican companies, namely Sempra Energy, Tamssa-Axtellarat Energy, and Transportation Maritim Mexico (TMM) at the Presidente Intercontinental Hotel here," Yusgiantoro said. 

He said Sempra Energy was ready to buy 3.7 million tons of LNG from Tangguh with the shipments to Mexico to start in the second semester of 2009. 

"Sempra Energy has 3 gas terminals in Baha, California, and their LNG demand will be supplied from our Tangguh field," Yusgiantoro said after accompanying President Yudhoyono at the one-on-one meeting. 

The minister said Indonesia had a final agreement with Sempra Energy and thus it was expected that the LNG would start to be shipped to Mexico through Baha gas terminal in California. 

"Sempra's gas terminal has been completed and its chief visited the Tangguh terminal. Therefore, the gas is expected to be shipped to California," Yusgiantoro said. 

He added that 65 percent of the US$1 billion in proceeds from the LNG sale to Mexico would accrue to government and 35 percent to the operator of the Tangguh field. 

Meanwhile, Tamssa-Axtelarat was exploring the possibility of building two gas terminals in Indonesia, one in Gresik, East Java, and another in Banten. 

The energy minister said Tamssa-Axtellarat would cooperate with a consortium consisting of Indonesia's state oil and gas company Pertamina, electricity company PLN and gas company Perusahaan Gas Negara (PGN). 

"Axtellarat has the capability to build gas terminals at sea, and the gas from the two terminals which are to be built by Mexico in Indonesia will be used to meet gas demand in Java," Yusgiantoro said. 

He said the third Mexican company, TMM, would buy 6 million tons of coal per year from Indonesia to fire power plants in Mexico. 

Yusgiantoro said Mexico still had to complete a coal port building project but in the one-on-one meeting with President Yudhoyono, the TMM chief said he was ready to speed up the port building project to facilitate the purchase of coal from Indonesia. 

In the one-on-one meeting, President Yudhoyono was accompanied by Foreign Minister Hassan Wirayuda, Energy Minister Purnomo Yusgiantoro, Trade Minister Mari Pangestu, State Minister/State Secretary Hatta Rajasa, and presidential spokesmen Dino Patti Djalal and Andi Malarangeng.

Hospitals take part in effort to reduce waste, emissions

Agnes Winarti and Triwik Kurniasari, The Jakarta Post, Jakarta | Mon, 11/17/2008 10:46 AM  

Green movements, which have sprouted up over the last few years, have encouraged hospitals in the capital to adopt environmentally friendly habits. 

State-own cancer hospital Dharmais in West Jakarta has been reducing its electricity and water usage, reusing paper and producing compost out of its organic waste for years, said head of public relations and domestic affairs at Dharmais, Bambang Purwanto, in a recent interview. 

Dharmais has been encouraging staff members to reuse administration papers and recycle organic waste as compost fertilizer for the past five years, Bambang said. 

"We can reduce up to one third of our monthly paper use, for instance, by using both sides of the paper for administration," Bambang told The Jakarta Post. 

He said the hospital produced up to a ton of compost every month, mostly used as fertilizer for plants on the hospital grounds. Dharmais stands on a 38,920-square-meter plot of land. 

"Several months ago, we began recycling our paper waste. We then use the recycled products as scrap paper," he said, hinting at a plan to go commercial with their recycled paper products some time in the future. 

Eight-story Dharmais has also reduced its use electricity and water usage over the last 10 years. 

"We have managed to cut some 20 percent off our monthly electricity and water expenses. So, we save hundreds of millions off monthly utility spending and use it for improving our employee's welfare," he said. 

"It is not an easy task raising people's awareness and changing their bad habits. They need to be constantly reminded. We make an effort even with the smallest of things." 

Bambang said the simplest yet strongest thing the hospital could do was put stickers on all electricity buttons and water taps reminding staff and patients to reduce their utilities usage when applicable. 

A banner placed in the hospital area encourages staff to set air conditioners at 25 degrees Celsius. 

After years, Dharmais has finally received public recognition for their environmentally friendly efforts. 

It was recently chosen as the first winner among nine other finalists in the Jakarta Green Office Competition co-sponsored by several NGOs and companies, including World Wide Fund for Nature (WWF) Indonesia, and the Jakarta Environmental Management Board (BPLHD). 

"We are very proud to win the award, especially because we are the only hospital participating in the event among dozens of other commercial companies," Bambang said. 

Over the past 10 years, the hospital has established a special team called the Energy Saving Team, which monitors excessive energy use. Any unit reported for failing to save energy will be reprimanded." 

The hospital recently does not only encourage electricity, paper and water savings, but also fuel consumption reductions by encouraging staff members to use public transportation, carpool, or cycle or walk to and from the hospital. 

Since it was established in 1993, Bambang said, Dharmais had its own waste management system for liquids as well as an incinerator to burn body parts taken during surgery and used-medical equipments, such as needles. 

Besides Dharmais, Persahabatan Hospital in Rawamangun, East Jakarta, is also promoting green habits. 

It has provided vast green areas in a bid to increase air quality around the hospital, said the hospital's director Agung P. Sutiyoso. 

"Providing a green and healthy environment is a part of our service to patients, so they will feel safe and comfortable," Agung said. 

"We believe good air quality at the hospital will fasten the patients' recovery," he said. 

He said Persahabatan had a 96,717-square-meter green area, more than 70 percent of its 134,521-square-meter plot of land. 

The hospital has its own water waste treatment plant, two incinerator machines and an environmental laboratory, he added. 

"In the near future, the hospital management will install a non-Freon air conditioner to curb green house emissions. We will also open a special clinic for smokers who want to quit smoking because smoking contributes to air pollution," he said. 

Persahabatan management also encourages their employees to adopt eco-friendly habits, such as using both sides of the paper and using water and electricity efficiently, said Oni Konsa, the hospital's gynecologist.