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alimantan’s coal railway project linking Puruk Cahu and Lupak Dalam in Central Kalimantan is set to begin in the first quarter of 2013 to cope with the shortage of road transportation facilities in the province.

National Development Planning Board (Bappenas)’s public private partnership (PPP) director Bastary Indra Pandji said four investors: Japan’s Itochu, China Railway, Bakrie Indo Infrastructure and Dubai’s MEP had submitted their project proposals to the provincial government.

“By looking at the progress today, we are optimistic the winner of the tender will be announced early next year and that the project will begin in the first quarter [of 2013],” Bastary said on the sidelines of Trans Kalimantan Railway Project Review in Jakarta on Tuesday.

The 300-kilometer tracks will connect three coal centers in the province: Puruk Cahu of Murung Raya regency, Bangkuang of South Barito regency and Lupak Dalam of Kapuas regency.

“Previously, the project was aimed to only connect Puruk Cahu and Bangkuang. But, we decided to expand it to Lupak Dalam because it will help the province transport more coal,” he said.

He said the Rp 20 trillion (US$2.08 billion) project, one of major infrastructure projects to be developed under the PPP scheme, is scheduled for completion at the end of 2017. The railway will have the capacity to transport 20 million tons of coal annually.

The Central Kalimantan government chose to develop railways since infrastructure like roads and rivers were not enough to support the government’s aim to further develop the coal industry, he said.

In addition, Transportation Ministry’s railway director general Tun-djung Inderawan said there are 10 railway projects in Kalimantan that will be developed under the PPP scheme until 2020. They include Banjarmasin–Pelaihari–Batakan and Tanjung–Martapura–Banjarbaru–Banjarmasin Airport in South Kalimantan; Balikpapan–Samarinda and Tanjung Redep–Lubuk Tutung in East Kalimantan, and an intra-provincial project to include Muara Teweh (Central Kalimantan)–Samarinda (East Kalimantan).

He said that currently, respective provincial governments, Bappenas and investors interested in the projects were carrying out a feasibility study on the projects.

“We are hoping that railway infrastructure projects in East Kalimantan and Central Kalimantan can be completed by 2020,” Tundjung said.

The Puruk Cahu and Lupak Dalam railway, and the 10 railway projects will be part of the Trans Kalimantan Railway Master Plan that will cover 49 important sections. Total investment for the projects is estimated to cost about Rp 600 trillion ($62.4 billion). Twenty out of 49 sections have the potential to be developed under the PPP scheme, while others are suitable to be built by private companies. One of the projects that will be built by private companies is the railway connecting East and Central Kalimantan.

Russia’s state railway firm Joint Stock Company (JSC) Russian Railways will build a railway line in East Kalimantan to deliver coal in an investment of approximately $2.4 billion, funded by private investors and Russian state development bank Vnesheconombank. In the second phase of the project, the Russian company would connect the railroad to Murung Raya regency in Central Kalimantan with a 60-kilometer line.

Besides the Russian project, Middle East Coal Holdings of the United Arab Emirates will also build a 135-kilometer railway from Muara Wahau to Lubuk Tutung Port in Bengalon, Kutai Timur regency in East Kalimantan to transport coal, with a total investment of Rp 5 trillion ($560 million), he said.