State fertilizer company PT Pupuk Kalimantan Timur (Pupuk Kaltim) plans to issue Rp 1 trillion (US$98 million) in bonds in the third quarter of this year to finance new projects, a high ranking
official said.
President Director Hidayat Nyakman told reporters in Jakarta on Monday the ongoing projects included the fifth unit of the company’s urea fertilizer factory and coal boiler, both of which would cost
$1 billion.
“We need $935 million to build the Kaltim V unit. The unit will replace the old Katim I factory,” he said, adding Kaltim V would produce 3,000 tons of ammonia per year, 1,000 tons bigger than Kaltim I annual capacity.
Hidayat said the coal boiler, which requires $100 million of fund, will be used to diversify the use of natural gas.
“The fertilizer factory usually uses natural gas. With this boiler, we will not totally depend on
natural gas.”
He said the company was now busy screening consultants, underwriters and other supporting institutions, such as Bahana Securitas and Danareksa.
Pupuk Kaltim’s urea production rose 12 percent in the first quarter of this year to 756,000 tons from 675,000 tons in the same period of last year.
Last year, Pupuk Kaltim, which is the biggest state fertilizer company, planned to issue $150 million in bonds but the company finally decided to postpone the plan due to uncertain economic conditions in the country.
Established in 1984, the company now operates 4 ammonia and 5 urea fertilizer plants in Bontang, East Kalimantan. Its urea fertilizer product is available in granules and in bulk.
Ammonia is produced through a reaction with high pressure in the process of producing urea.
Pupuk Kaltim also produces a new fertilizer product called NPK Pelangi. NPK Pelangi gives greater productivity by 40 percent to rice.
The factories use natural gas as feedstock supplied through a 60 kilometer pipeline extending from Muara Badak to the Bontang industrial estate in Bontang. (naf)
Pupuk Kaltim’s urea production rose 12 percent in the first quarter of this year to 756,000 tons.
