Port, Industrial Park Seeking Funds
Fuel distributor AKR Corporindo and state port operator Pelindo III are seeking up to Rp 5.6 trillion ($576 million) in external financing to fund an integrated port and industrial park in Gresik, East Java, a AKR director said on Monday.
AKR and Pelindo III are establishing two joint ventures to develop the Java Integrated Industrial Port and Estate. The port complex will consist of a deepwater port and an industrial complex that will be supported by electricity as well as transportation infrastructure, such as a railway network and toll road.
The two JVs are Berkah Manyar Sejahtera, which will work on developing the port, and Berkah Kawasan Manyar Sejahtera, which will be in charge of developing the industrial park.
The JIIPE project hopes to attract significant domestic and foreign investors to open up facilities in the industrial park.
“The total investment in the projects is estimated at around Rp 7 trillion to Rp 8 trillion. The source of financing is 30 percent from equity and 70 percent from external funds,” Suresh Vembu, a director at AKR, said in Jakarta on Monday.
The external funds can come from bank loans, project financing from financial institutions or bonds.
AKR owns a 40 percent stake in Berkah Manyar and Pelindo III controls the remainder. The share control is the opposite for the Berkah Kawasan project.
AKR is a Jakarta-based integrated logistics supply chain specialist and the largest private distributor of fuel and basic chemicals.
Meanwhile, Surabaya-based Pelindo III operates 40 ports in seven provinces in Indonesia.
The JIIPE project will be built on 2,500 hectares of land. Of the needed area, Pelindo III has completed 900 hectares of necessary land acquisition, 36 percent of the project’s total.
“We are committed to increasing efficiency in the logistics sector, because the Tanjung Priok Port [in Jakarta] and Tanjung Perak Port [in Surabaya] are overcrowded,” Suresh said.
The JIIPE project — estimated to take four years — will consist of three phases of development.
East Java is home to some heavy industries with companies operating in the region being a major employer.
In a statement on March 25, AKR president director Haryanto Adikoesoemo said the JIIPE project is expected to begin by July this year.
AKR was awarded by downstream oil and gas regulator BPH Migas the right to distribute subsidized petroleum, with an initial 2013 allocation of 267,892 kiloliters.
AKR’s subsidized fuel allocation increased by 160 percent this year from 2012.
The company said it expected Indonesia’s strong economic growth and rising demand for consumer goods will increase demand for fuel, the raw materials used to produce consumer goods, construction materials and chemicals. As a result, improved logistical infrastructure is essential, the company said
Source: http://www.thejakartaglobe.com/
Leave a reply