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ublicly-listed PT Titan Kimia Nusantara Tbk, the largest polyethylene manufacturer in Indonesia, plans to build a naphtha cracker complex near the company’s industrial plant in Merak, Banten as part of the company’s expansion in the petrochemical industry.

Non-affiliated director, Johanes Bambang Budihardja, said in Jakarta on Wednesday that Titan Kimia would invest between US$3 billion and $5 billion to build the naphtha cracker complex that would produce ethylene with a capacity of 700 kilo tons per annum (KTA). In addition, the new plant would also produce prophylene with a capacity of 500 KTA.

The company planned to start the construction of the naphtha cracker complex in 2013 but it was later delayed to 2017 due to a land acquisition problem, Johannes said, adding that operations would be delayed until early 2018 from early 2016 as originally scheduled.

He said that Titan Kimia had secured about 37 hectares of about 100 hectares of lands needed for the construction of the new plant. The company was still negotiating the possibility of acquiring the other 60 hectares from state-owned steel producer PT Krakatau Steel.

Lee Hun Ki, the chief commissioner of Titan Kimia, said that about 60 percent of the funding would be obtained from Korea Eximbank (KEXIM), the official export credit agency of South Korea, and another 40 percent from parent company Lotte Chemical Titan International Sdn. Bhd.

Titan Kimia produced 352 kilo metric tons (KMT) of polyethylene in 2012, the highest production level achieved by the company since the operation of the plant began.

Titan Kimia is 95.31 percent owned by its investment holding Lotte Chemical Titan International Sdn. Bhd and 4.69 percent by the public.

Titan Kimia suffered a net loss of $16 million in 2012, declining from about 23 million in 2010 thanks to increase in sales and customers. Titan Kimia has been in the red since 2010. (fan)