Seven foreign investors to build cocoa plants in RI

Antara News, Monday, October 18, 2010 22:30 WIB

Jakarta (ANTARA News) - Seven foreign investors have expressed keen interest in building cocoa processing plants in Indonesia following the imposition of duties on cocoa exports as of April 1, 2010.

The seven investors are ADM Cocoa and Olam International of Singapore, Guanchong Cocoa of Malaysia, Cargill and Mars of the United States, Armajaro of Britan, and Ferrero of Italy, Director General of Agribusiness at the Industry Ministry Benny Wachjudi said on Monday.

"I don`t know when the investors will start investing. But they have asked for clarification on the possibility of the government reviewing the imposition of duties on cocoa exports," he said.

Benny said Guanchong Cocoa was likely to build a cocoa processing plant with an annual capacity of 50 thousand tons early next year.

In addition, he said local cocoa producer PT Bumitangerang Mesindotama would also double the production capacity of its plant in Tangerang, Banten province, to 80 thousand tons per year.

The expansion project which would cost an estimated US$40 million would be completed in eight months` time, he said.

Benny said a number of downstream cocoa processing plants had begun to revive their activities after they ceased operation.

Chairman of the Indonesian Cocoa Producers Association (AIKI) Piter Jasman said the imposition of duties on cocoa exports had a positive impact on the growth of downstream industries.

"Fifteen AIKI members have raised their production capacity. The national cocoa powder and butter production is projected to reach 300 thousand tons in 2011," he said.

Third Biggest European Investor in Indonesia

Kompas.com, Kamis, 5 Agustus 2010 | 17:42 WIB

LONDON, KOMPAS.com - Italy is the third biggest European investor country in Indonesia after Britain and the Netherlands with an investment value of US$4.05 million in the first quarter of this year, a diplomat said.

"Italy’s investment of US$4.05 million in the first quarter of 2010 increased 200 percent compared with that in the same period a year earlier which stood at US$1.4 million," Musurifun Lajawa, counselor for social and cultural affairs of the the Indonesian Embassy in Rome, said in a press statement received by ANTARA here on Thursday.

He said that Italy’s investment in the third quarter of 2010 was made in three projects while that in the first quarter of 2009 was for four projects.

According to the Investment Coordinating Board (BKPM), Italy’s investment in Indonesia in the first quarter of 2010 increased 192.9 percent.

Italy was in the fifth position on the list of European investors in Indonesia in the January - December 2009 period after the Netherlands, Britain, Switzerland and Germany. During the period, Italy’s investment reached US$41.02 million. In the last nine years (January 1990 - 2009), Italy’s investment ranked the sixth position after Britain, the Netherlands, Germany, France and Switzerland. Is investment in this period reached US$660.90 million.

Based on the data, Italy’s total investment in Indonesia in the January-February 2010 period amounted to US$501.59 million, which was a 4.8 percent increase compared with that in last year’s corresponding period of US478.51 million.

RI eyes more investment from Italy, Luxembourg

Hyginus Hardoyo, The Jakarta Post, Rome | Sat, 11/21/2009 12:12 PM

Indonesia is looking to attract further investment from Italy and Luxembourg - two European countries largely untapped so far, Indonesian Vice President Boediono said Thursday.

Speaking after a meeting with representatives of 14 Italian companies at the Hassler Roma Hotel in Rome, Boediono said Italian businessmen had expressed an interest in doing business or in continuing to expand their existing operations in Indonesia.

Some of the 14 Italian companies have already established joint ventures in Indonesia in various fields, ranging from oil and gas exploration, coal mining, engineering and construction, to leather production.

ENI Indonesia Ltd., one of energy giant ENI SPA's subsidiaries in Indonesia, for example, has completed its gas and oil exploration in Ambalat waters in East Kalimantan.

"The oil and gas production there is already in the pipeline. It .., is still waiting for certainty," Boediono said, referring to border areas in Ambalat currently in dispute between Indonesia and Malaysia.

Other Italian companies invited to the meeting included Assorcarboni and Enel SPA, which both specialize in coal imports, Allilauro SPS (in maritime transportation), Fiat Group (automotive industry), Ponte de Archimede SPA (in alternative and eco-friendly energy development) and Trevi SPA (in drilling and foundation engineering services).

The meeting was held on the sidelines of Boediono's visit to Italy to attend the Food and Agriculture Organization's World Summit of Food Security at the FAO headquarters on Wednesday in Rome.

During the visit, Boediono was accompanied by Agriculture Minister Suswono and Investment Coordinating Agency (BKPM) chief Gita Wiryawan, who joined the Vice President's entourage after visiting Luxembuorg.

Gita said a similar interest had been expressed among businessmen from Luxembourg, especially in the coal business.

"Around 50 percent of Luxembourg's coal imports are supplied by Indonesia," Gita said, without providing details on the volume.

Indonesia has become the largest coal exporter to Italy, with a current market share of 30.9 percent.

In 2004, Indonesia's coal exports to Italy reached US$314.9 million. This figure jumped to $959.9 million in 2008.

Exports in the January-May period in 2009 dropped by 20 percent from the corresponding period in 2008, but this decline affected all coal exporters to Italy.

Given the promising response among investors in Italy and Luxembourg, Gita said the Indonesian government would do its best to improve bilateral trade with the two countries.

Gita further said foreign investment commitments registered with BKPM had reached $13 billion so far this year, adding that only a fraction of this amount had come from Italy.

Eximbank restructures $88m loans to PT PAL

The Jakarta Post, Jakarta | Mon, 04/06/2009 8:32 PM

Indonesia’s Export Import Bank (BEI) signed a deal to restructure its troubled Rp 1 trillion (US$88 million) loan owed by ailing state shipyard company PT PAL on Monday to help keep the company afloat.

“Our loans to PAL almost reached the maximum limit of disbursed credits, or 25 percent of our total equity which stands at Rp 4.3 trillion,” BEI president director Arifin Indra said on Monday.

He said the bank would still support PAL despite their weak condition by restructuring some of their loan requirements.

“The bank is only restructuring the loans related to working capital for the construction of vessels that are still 25 percent finished,” he said.

PAL has been in financial trouble since it received a contract for the construction of 20 vessels in 2006.

As costs of ship construction soared since then, PT PAL could not cover the increased full production costs and now, the company still has 18 unfinished orders.

The unfinished projects include the building of two vessels ordered by the Navy, four escort tugs worth $6.5 million each ordered by energy company BP Plc and three 38-meter boats ordered by the customs and excise agency.

There is another order for a 50,000 dead weight ton (DWT) vessels ordered by a Turkish private company.

PT PAL also has orders from Italian companies for a tanker with a capacity of 24,000 tons and two tankers with a capacity of 6,000 tons each.

Eni says finds new oil, gas offshore Indonesia

Reuters, Mon Apr 6, 2009 4:39am EDT

MILAN, April 6 (Reuters) - Italy's biggest oil and gas group, Eni (ENI.MI), has made a new hydrocarbon discovery offshore Indonesia as it aims to boost activity in the region, Eni said in a statement on Monday.

"The Jangkrik discovery, drilled in 400 metre water depth, represents a significant success in Eni's exploration efforts in the Kutei Basin and further confirms the high potential of its portfolio in the area," said Eni, the operator of the Jangkrik structure located east of Kalimantan.

Eni said it planned to proceed with the appraisal of Jangkrik discovery and to assess the technical and commercial viability of a fast-track development of the new field.

Eni said it also participates in the development of the significant gas reserves located in the Rapak & Ganal blocks in the Kutei Basin.

In the nearby Tarakan Basin, Eni has in recent years made two other important hydrocarbon discoveries, Aster and Tulip, both of which are now in an advanced appraisal phase, it said.

Eni holds overall working interests in 11 permits in Indonesia and operates six of them. The offshore activities are located in the deep waters of the Tarakan and Kutei Basins and north of Sumatra Island.

Other activities are in the Mahakam River Delta, East Kalimantan, where Eni has an equity production of about 20,000 barrels of oil equivalent per day. (Writing by Svetlana Kovalyova, editing by Anthony Barker)

IBM Jumps on the High-Speed Rail to China

Fastcompany, BY Ariel Schwartz, Wed Mar 25, 2009 at 1:50 PM

Oil prices may not be rising quite as dramatically as they were a year ago, but mass transportation--and more specifically, high-speed rail--is still growing in scope and importance. According to the International Monetary Fund (IMF), three quarters of G-20 countries (including France, China, Germany, Indonesia, and Italy) plan to increase funding for transportation infrastructure. And since the cornerstone of any successful transportation network is reliable computer technology, it's not surprising to hear that IBM is jumping on the high-speed rail train.

The computer giant announced plans today for high-speed rail projects in China, Taiwan, and the Netherlands. IBM will be responsible for managing maintenance, logistics, and IT needs in the China and Taiwan projects, while the Netherlands will rely on the company for resource utilization. It's not a small job.

In the Netherlands, IBM will oversee nearly 5,000 trains passing through a network of 279 stations. The Guangzhou Metro Corporation (GZ Metro) transports 2 million passengers per day across 60 stations, and is investing $1.76 billion this year to expand the network.

All of this is great news for denizens of these three countries, but what about those of us in the United States? When do we get our fancy high-speed rail lines? Relatively soon, if the U.S. government's $8 billion in rail-line stimulus funds goes ahead as planned. And when we do get our high-speed rail, IBM is likely to be a part of it. The company, which manages Amtrak's reservation system, is already angling for a chunk of the stimulus money. In the end, IBM might be known more for its ubiquitous transportation software than its consumer technology.

Indonesia Pertamina to pick Natuna block partners

Reuters, Tue Mar 17, 2009 6:48am GMT  

KUALA LUMPUR, March 17 (Reuters) - Indonesia's state-run oil firm, Pertamina, plans to decide on its technical partners for the giant Natuna D-Alpha gas block this month or the next, a company official said on Tuesday. 

The Natuna block contains around 222 trillion cubic feet (tcf) of gas reserves, of which about 46 tcf are thought to be commercially recoverable. 

"Hopefully this month. Maybe also in April. We would like to speed things up," Gunung Sardjono Hadi, the firm's vice-president for upstream business development, told Reuters at a conference in the Malaysian capital. 

Indonesia appointed Pertamina as the operator of Natuna, but the firm does not have the capacity to develop the gas field alone, with an estimated investment of $40 billion required. 

The decision will be based on the findings of an independent consultant. Last year Pertamina selected Wood Mackenzie to advise on picking partners to develop the giant gas field. 

"We have some requirements in this aspect (of picking a partner), because Natuna has huge potential," Hadi said. "The partner has to have capability in carbon dioxide removal, developing offshore projects and to produce the end-product." 

The Southeast Asian country in January rejected a proposal by Exxon Mobil Corp (XOM.N) to develop the Natuna field, since it believes the contract held by the U.S. oil major expired in 2005. 

Last year, Pertamina named eight international oil and gas companies it would consider as partners, including Exxon Mobil, Chevron (CVX.N) and France's Total (TOTF.PA). 

Royal Dutch Shell (RDSa.L), Norway's StatoilHydro (STL.OL), Italy's Eni (ENI.MI), Malaysia's Petronas [PETR.UL] and China National Petroleum Corp are the rest. 

The block, which is about 1,100 kilometres (680 miles) north of Jakarta and 200 km east of the West Natuna fields that feed gas to Singapore, accounts for about a quarter of Indonesia's total commercially recoverable gas reserves of 182 tcf.

Money No Object For Streetcar One Desires

The Jakarta Globe, Dian Ariffahmi, February 6, 2009
 

A model poses beside a $568,000 Italian-made Lamborghini Gallardo during the opening of Lamborghini’s first outlet in Indonesia on Friday. (Photo: Jurnasyanto Sukarno, JG)
 

Where would you find a person who would splash out on a super-expensive luxury car in the middle of a world recession, perhaps by buying a Lamborghini with a maximum speed above 300 kilometers per hour, in an often-flooded, traffic-clogged megacity? Here, it seems. And someone is buying. 

The CEO of the Italian dream car’s local office, who on Friday officially opened the first showroom in Indonesia for the top-end sports car, seemed slightly embarrassed about the whole idea. 

“We are fully aware that this is not the right moment to open such a luxury vehicle showroom, amid the global downturn and the weakening of consumer purchasing power, but we have been preparing this for two years,” Lamborghini Indonesia chief operating officer Endy Kusumo said on Friday. 

He also said that the company believed that the Indonesian market was better off than the mar kets in Europe or North America. 

“There are some people [buying], although I cannot mention how many, their names or what kind of model they want,” he said of what must be an very elite line forming to purchase a “Lambo.” 

“A car like the Lamborghini has loyal fans, and that means its sales won’t be affected by the current global downturn,” Endy said. 

With an investment of around $1 million here, Lamborghini has set itself “a realistic target” to sell 12 units this year, he said. 

At the launch, Lamborghini introduced two of its six models — the 10-cylinder Gallardo LP560-4, which carries a price tag of $568,000, and the 12-cylinder Murcielago LP640, the car featured in the “Dark Knight” movie, which sells for $798,000. 

The Gallardo has a top speed of 325 kph and can reach 100 kph in just 3.7 seconds. The Murcielago tops out at 340 kph. 

But you can’t just pop in and drive one away. Lamborghini does not have cars in stock, and interested buyers must place an order and then wait about three months for delivery, Endy said. 

Endy noted that Indonesia already has 12 Lamborghini owners, but he did not give up any names. Owners, however, are believed to include a famous lawyer who already has a Ferrari in his garage, a wealthy patron of the arts and — not surprisingly — some rich businessmen. 

If you are in the market, the new showroom is on Jalan TB Simatupang in South Jakarta, near the showrooms for Ferrari and Porsche.

Related Article:

Forgotten classic car sells for 3.4m euros at auction

Government plans to provide incentives for coal bed methane project developm

Ika Krismantari and Alfian, The Jakarta Post, Jakarta | Mon, 02/02/2009 4:05 PM  

The government is mulling incentives for companies that develop Coal Bed Methane (CBM) projects in the country, in an attempt to attract more investment in the sector. 

The energy ministry's oil and gas director general, Evita H. Legowo, told The Jakarta Post recently that the incentive scheme for CBM developers would adopt the tax facility system granted to oil and gas contractors in Indonesia. 

"*The incentive is needed because* we want to attract more investment in the *CBM* sector," Evita said. 

Under existing Finance Ministry regulations, every oil and gas activity in the country is exempt from import duties for exploration equipment, and also exempt from value-added tax. 

Even though CBM is closely related to oil and gas exploration activities, the government has yet to include the alternative natural gas in the category that enjoys the tax and duties exemptions. The regulation only allows the incentives for the development of oil, gas and geothermal energy. 

CBM is a method of extracting methane from coal seams. Once the methane has been separated, it can serve as an alternative to natural gas. 

The government first unveiled CBM projects in the country in 2007, offering them up to investors. 

The government provides a relatively better production split for CBM projects than oil and gas projects, increasing CBM operators' profit sharing to 45 percent - much higher than the 15 percent and 30 percent that oil operators and gas operators get, respectively. 

Compared to the development of oil and gas, CBM projects require a lot more investment and time, with the exploration phase involving a process of discharging water from underground, which can take years before the gas can be extracted. 

The government has awarded four CBM development contracts in Kalimantan to a group of mining companies, requiring a total investment of at least US$20 million over the next three years. 

The four companies are a consortium of PT Pertamina Hulu Energi Metana Kalimantan A-Sangatta West CBM Inc; a consortium of Kutai West CBM Inc-Newton Energy Capital Limited; PT Indobarambai Gas Methan, and PT Barito Basin Gas. 

Recently, Vico Indonesia, jointly owned by UK oil behemoth BP Plc and Italy's Eni SpA, announced plans to develop a CBM project in the Sanga Sanga concession in Kalimantan, with a total investment of $600 million. 

Vico, which already owns a gas concession in the area, will speed up drilling for the CBM projects by 2012 and deliver gas from the coal seams by at least 2020. 

Gas production from CBM is expected to help the government reverse a declining trend in gas output. Indonesia has the world's second largest CBM reserves after China, with total potential reserves of 453 trillion cubic feet. 

The government has predicted a decline in gas production to 7.3 billion cubic feet per day this year, lower than the 7.9 billion cubic feet per day recorded in 2008, due mainly to aging fields. 

Under its blueprint for the development of CBM, the government is targeting production of 1 billion standard cubic feet per day, or about 0.18 million barrels of oil equivalent, by 2025.

Australia, US agree debt swap programs with Indonesia

Jakarta (ANTARA News) - The United States and Australia have agreed to swap loans to Indonesia with other programs through a debt-swap scheme, an official at the chief economic minister's office said. 

"The United States and Australia have agreed to implement debt-swap programs after Germany and Italy made  debt-swap commitments to Indonesia," Mahendra Siregar, deputy for international affairs to the coordinating minister for economic affairs, said here on Friday. 

He said the two countries had previously provided their debt-swap commitments for Indonesia. One was still under negotiation and the other one  about to enter a negotiation process. 

Siregar said  the US had promised to use  US$19.6 million worth of  loans to Indonesia in a debt-swap program for financing tropical forest conservation in Indonesia. 

In the meantime, Australia had also promised a debt-swap in the public health field  to finance the handling of HIV/AIDS, malaria and tuberculosis in Indonesia. 

"The value of the debt-swap in the public health field is US$75 million. I hope negotiations on this scheme can be started soon," he said. 

He said  his office would be receiving an Australian delegation to discuss the matter next week. 

Siregar said Germany had provided Indonesia with a debt-swap  scheme in the public health field  worth 143.56 million euro. There was also a debt-swap to nature scheme  worth 20 million euro which was still under negotiation. 

Italy's commitment to debt-swap was signed on March 9, 2005 and was in force until 2010. The commitment had the potential to write off Indonesia's debts worth US$24.2 million and 5.7 million euro. 

In 2007, Italy and Indonesia formally agreed to the financing of projects in Nanggroe Aceh Darussalam province where Italy wrote off 1.43 million euro and US$5.03 million.

Saipem gets 70-year Riau land concession

Mustaqim Adamrah, The Jakarta Post, Singapore   

The Riau Islands provincial administration has finally granted Italian-based turnkey oil and gas contractor PT Saipem Indonesia a 70-year land concession for its massive proposed project on Karimun Island. 

The concession is part of the administration's efforts to encourage businesses to invest in the province's free trade zones (FTZs) in line with the 2007 law on FTZs, Governor Ismeth Abdullah said late Thursday during a signing ceremony at the Indonesian Embassy in Singapore. 

Also attending the ceremony were Saipem Indonesia offshore area manager Asia Pacific and managing director Michel Lain*, Indonesian Ambassador to Singapore Wardana, Karimun Regent Nurdin Basirun and the head of the Indonesian Investment Coordinating Board's Singapore representative office, Nurul Ichwan. 

"The company will use the 140-hectare land for a production facility, with a production capacity of 20,000 tons of oil and gas and related products," Lain* said. 

Pipelines, he said, would connect platforms and transport oil and gas from offshore to onshore. 

It is estimated that the first phase of construction of the facility will cost US$450 million and provide 5,000 jobs. 

Parent company Saipem International offshore general manager Yves Invona previously said the facility would become the production and logistics base for the Saipem Asia Pacific Group. 

He said the facility would start operations in 2010. 

Governor Ismeth has said the project confirms the revival of foreign direct investment in the province. 

Last year, Riau Islands attracted about $1 billion in investment, more than double the $484 million received in 2006. 

Karimun alone has attracted $700 million in investment this year, according to Ismeth. 

He said he aims to bring in $5 billion of investment during the next five years. 

Located 30 minutes from Singapore by ferry, Karimun is one of the province's three islands, which are designated as FTZs. 

The other islands are the Batam and Bintan Islands . 

Batam's main industries are electronics, manufacturing and shipbuilding. Bintan, with its garment and electronics manufacturing industries, measures 4,063 square kilometers, and Karimun, renowned for its deep-sea port, covers an area of 8,000 square kilometers.

Govt gives Chevron go-ahead to develop Galan gas block

Ika Krismantari, The Jakarta Post, Jakarta | Fri, 05/02/2008 1:33 PM

The government has approved a proposal by U.S. company Chevron to develop gas fields of the so-named Galan block located in deep water off East Kalimantan, a minister says.

"A few days ago, I signed the approval for Chevron to develop a gas block in East Kalimantan's deep waters," Energy and Mineral Resources Minister Purnomo Yusgiantoro said Wednesday.

Purnomo said a persistent surge in oil prices had made the development of deep sea blocks, previously considered problematic and costly, more attractive as the price of gas is expected to soar in line with oil costs.

"The current price of oil has reduced the risks of developing deep sea gas blocks."

Figures from the ministry's Directorate General for Oil and Gas show Chevron has committed to spending up to US$311.64 million to develop the block, which is believed to have the potential to produce an average of 800 million cubic feet per day.

Indonesia, the world's third largest gas exporter is under pressure to increase its gas production to meet gas export contracts, as well as to supply for increasing domestic demands.

Chevron spokesperson Santi Manuhutu said the company had yet to receive the approval letter.

Chevron holds 80 percent of participating interests in the block, while the remainder is owned by Italian oil and gas company Eni.

Foreign insurance firms eye expansion

The Jakarta Post, Thu, 04/24/2008 12:25 AM  |  Business

Five insurance companies from France, Singapore, the United Kingdom, Italy and Malaysia are seeking local partners to tap the increasingly lucrative Indonesian life insurance industry, an insurance association says.

Chairwoman of the Indonesian Life Insurance Association (AAJI) Evelina Pietruschka said in a statement Wednesday the companies had approached the association for information on qualified companies for potential partners.

"They are now seeking suitable partners to enter the life insurance industry here," she said.

The association refused to name the foreign companies.

Optimism over the country's higher economic growth coupled with the need for a diversified long-term investment portfolio are the primary reasons the foreign companies are setting out to engage the Indonesian market.

The association has forecast a 30 percent growth in revenue from premiums for 40 major insurance firms in Indonesia this year, to around Rp 58 trillion (US$6.3 billion).

Last year, the industry experienced unprecedented growth of 67 percent from Rp 26.5 trillion in 2006 to Rp 44.4 trillion, according to the AAJI.

"For five years, the industry grew by 25 percent each year. But last year's 67 percent jump in revenue from premiums was an outstanding phenomenon.

"The growth was fueled mostly by a shift in investor interest in putting money more into long-term insurance products than into short-term bank deposits. I believe the trend will continue as the public becomes aware of the benefits of insurance," Evelina said.

With investable funds worth Rp 90.9 trillion last year, up by 50 percent from Rp 60.7 trillion in 2006, the industry recorded a 76 percent jump in investment proceeds to Rp 10.4 trillion.

The 40 insurance companies' combined assets were worth Rp 101.2 trillion as of 2007, a 52 percent increase from the previous year.

The companies include a state-owned firm, 24 domestic firms and 15 joint ventures.

Italy`s Saipem to build dockyard, offshore rig in Riau

Jakarta (ANTARA News/Asia Pulse) - The Saipem Group from Italy has started preparation to build a dockyard and an offshore rig in the Karimun regency of Riau, Indonesia with an investment of US$370 million.

The project was inaugurated yesterday by Transport Equipment Director General Budi Darmadi, the newspaper Bisnis Indonesia reported today. General Manager of Offshore Business of the Saipem Group Yves Inbona said the investment will be needed to buy land and build a steel factory and ferry terminal.

The facilities will be operated by a subsidiary, PT Saipem Indonesia. The factory is expected to start operation in 2010 and its output will be exported to countries such as China, India and South Korea.

Premier Oil to sign gas deal with Indonesia`s PLN

Jakarta (ANTARA News) - U.K. oil explorer Premier Oil Plc will sign a deal to supply gas to Indonesia's state electricity firm company, PT Perusahaan Listrik Negara (PLN), the country's energy watchdog said on Monday.

Under the planned head of agreement, Premier would supply 149 trillion British thermal units (BTU) of gas to PLN over a 15-year period, the watchdog, BP Migas, was quoted by Reuters as saying in a statement.

The watchdog also said that another group of foreign firms, including Total SA, Vico Indonesia, Chevron Corp, and Italy's Eni, would sign a joint deal to supply 726 trillion BTU of gas to an Indonesian fertiliser firm, PT Pupuk Katim, over a 10-year period.

In addition, Indonesia's largest listed energy company, PT Medco Energi Internasional Tbk, is due to sign a supply agreement with another fertiliser firm, PT Pupuk Iskandar Muda.

Under the deal, Medco would supply 223 trillion BTU of gas to Iskandar Muda over the 6-7 year term of the contract.

Indonesia is the world's second-largest producer of liquefied natural gas but production is expected to fall by 4 percent next year, while exports may fall even further as its seeks to divert more gas to the domestic market.

The Southeast Asian nation has also been trying to increase gas production to substitute for flagging oil crude production.

Italian cable maker plans to invest $4 million more to boost production

The Jakarta Post, Jakarta

PT Prysmian Cables Indonesia, a subsidiary of an Italian high-tech cable manufacturer, will invest up to US$4 million to increase the capacity of the company's telecommunication and electric cables at its plant in Cikampek, West Java.

The company's president director, Stefano Poli, said Saturday the additional investment would partly be used to purchase 13 new machines in order to increase the production of optical fiber cables up to 500,000 kilometers from 200,000 kilometers, and the capacity of electric cables to 16,000 tons from 9,000 tons at present.

The new production facility, which is scheduled to begin operation next year, is expected to be able to produce around 3,000 metric tons during the first year, he said.

"Production will be further increased in subsequent years in line with demand," he told reporters at an event celebrating the company's 10th anniversary in Indonesia.

With the expansion, the growth rate of the company's profits could be doubled, he said.

PT Prysmian Cables, a subsidiary of Prysmian Group of Italy which has 54 plants in 35 countries, opened its factory in 1997 to meet the growing demand from Indonesia, other Southeast Asian countries and Australia.

"Indonesia has a very strategic location for our expansion in Asia. By having a plant here, we can save on logistical costs and transportation time to neighboring countries," said Jamel Yusof, Prysmian's industrial director for Asean countries.

Poli said the company currently sold 20 percent of its total product in the domestic market and the remaining 80 percent to other Southeast Asian countries and Australia.

He said the company had a 20 percent share in Indonesia's electric cable market and 15 percent in the telecom cable market, serving some local manufacturers including PT PLN (electrical-state company), PT Telkom, PT Indosat and PT Exelcomindo.

"Although we are currently focusing on global markets, I am very optimistic with the local market as demand is growing," he said. (ind)

Italy to scrap 9.3 mln euro Indonesian debt in exchange for humanitarian

Jakarta (ANTARA News) - Italy has agreed to cancel the equivalent of 9.32 mln usd worth of debt that Indonesia owes it on condition that Jakarta spends the same amount on six humanitarian projects in Aceh, an official said.

Aceh, the country's westernmost province, was devastated by a tsunami in December, 2004.

Coordinating Ministry for Economic Affairs spokesman, Mahendra Siregar, was quoted by XFN Asia as saying among the six projects approved by Italy are the building of a bridge and hospital and the reconstruction of a fishing harbour.

Last year, Italy cancelled 4.98 mln eur debt after Indonesia pledged it would spend the same amount on four projects in Aceh.

As of December 31, 2006, Indonesia's outstanding debt to Italy stood at 141.66 mln usd.

Eni told to submit plan before 2009

Ika Krismantari, The Jakarta Post, Jakarta

Italy-based oil firm Eni SpA risks losing the right to explore one of its blocks in Nangroe Aceh Darusallam if it fails to file an exploration plan with the government by 2009, an official says.

Kardaya Warnika, Upstream Oil and Gas Regulatory Agency (BPMigas) chairman, said Monday Eni had to present its Plan of Development (POD) for the exploration of the block, called Krueng Mane, before the 10-year time span allowed for its submission expires in 2009.

According to the relevant regulations, a block operator is given a period of 10 years to submit its POD to BPMigas, which has the right to revoke the contract if the operator fails to do so.

BP Migas could then offer the block to another company.

Eni secured a license in 1999 to operate the offshore block, in which it owns a 100 percent stake. The block is expected to produce gas to be supplied to fertilizer producers located in Aceh amid declining output from ExxonMobil's Arun LNG plant.

Figures from the Energy and Mineral Resources Ministry show that Eni had spent US$19.5 million on the offshore block to date.

When contacted by The Jakarta Post, Eni refused to comment.

The government has been pushing block operators to produce more oil as it wants to see a 30 percent increase in oil output by 2009.

Meanwhile, BPMigas's operations deputy chairman, Dody Hidayat, said the agency was awaiting the results of an oil-enhancing pilot project conducted by U.S. energy giant Chevron, using new technology.

Chevron is currently the country's largest oil supplier, producing around 414,000 bpd per year, over 40 percent of the country's total annual oil output of some 1 million bpd.

"If it succeeds, we will use it full scale in all Chevron's blocks by 2011. It (the new technology) is expected to provide additional output of up to 120,000 barrels of oil per day by 2018 or 2019," Dody said.

Italy's Eni, Pertamina sign cooperation agreement for oil and gas resources

The Jakarta Post

ROME (AP): Eni SpA, Italy's biggest oil and natural gas company, said Wednesday it had agreed to work with Indonesia's state-owned PT Pertamina to explore and develop oil and gas resources in Indonesia and abroad.

The companies' joint memorandum of understanding also foresees sharing technical know-how, and joint work groups have been set up to identify future projects for the two companies, Rome-based Eni said in a statement.

Eni already is operating in Indonesia , with offshore activities in the deep waters of the Tarakan and Kutei basins, and north of Sumatra. Eni also has been exploring the Tarakan basin for hydrocarbon reserves, and has operations in the Mahakam River delta.

Three Companies Participate in Bakrie's Biodiesel Tender

Jakarta (IOGNews) -Three foreign companies participates in biodiesel technology tender for the factory going to be built by PT Bakrie Sumatera Plantations Tbk (BSP) and PT Rekayasa Indonesia with total investment of USD25 million and with a total capacity of 100,000 tons per year.

The three companies participate in tender are Lurgi (Italy), Balestra (Italy), and Man-Ferristal (Germany). The result on the tender will be announced by end of this year and the physical building of the factory, which is located in Batam, is started on March 2007.

The biodiesel factory will start its operation on second quarter of 2008. This is possible because PT Rekin (Rekayasa Industri) is handling the EPC (Engineering, Procurement and Construction) process.

Vice President National Project BSP, Hepi Sapirman, stated that BSP and Rakin split the shares 70 percent : 30 percent, while the total investment required for the factory is USD25 million, USD5 million of the fund will be used as working capital.