Reuters reported that Australia Indo Mines is to start construction of a USD 1 billion project on Indonesia Java Island in December to begin operations in at least three years to produce 9 million tonnes to 15 million tonnes of iron ore a year.
Mr Mudrajad Kuncoro a local government official in Yogyakarta, central Java said the joint venture will involve PT Jogja Magasa Iron which will own a 30% stake in the project. He said that "We expect the ministry of energy and mineral resources to issue the permit to PT Jogja Magasa Iron in mid-November this year so the company can start its project in early December."
Indo Mines was not immediately available for comment.
Mr Kuncoro said the project will consist of a plant with production capacity of 1 million tonnes of pig iron and 2 million tonnes of iron concentrate per year, as well as a port a coal fired power plant, oxygen plant and water treatment facility.
He said that when it starts operations in three to five years time the project will produce 9 million tonnes to 15 million tonnes of iron ore annually and will consume around 1.2 million tonnes of coal annually.
The world fourth most populous country drew in a record USD 9.6 billion in foreign direct investment in first-half 2011 lured by its relatively stable politics and strong economy plus abundant resources and consumer spending power.
Despite issues over infrastructure, corruption and labour disputes, that trend is expected to continue as global firms look to take advantage of cheap labour and Indonesia huge mineral wealth.
(sourced from Reuters)