BNI targeting 150 Financing Procurement Railway carriage

PT Bank Negara Indonesia Tbk targeting procurement project financing and construction of 150 railway carriage owned by PT Kereta Api. Previously, BNI had withdrawn the loan to PT KA for working capital needs Rp300 billion.

Was determined Head of Corporate Banking BNI Rosa Delima Dwi Mutiari in conversation with Media Indonesia, last weekend. According to him, this time, PT KA require financing for the procurement of 150 rail cars in need financing almost Rp5 trillion. In addition, the construction of railroads to the airport that some funds are expected to come from banks.

The amount of these funds needs to establish a bank syndicate. Currently, BNI has established the possibility of syndicated financing PT KA those with PT Bank Rakyat Indonesia Tbk. This is part of the expected synergies SOE SOE Ministry to support the development of SOEs. Currently, the three parties was to test the feasibility (feasibility study).

Rosa reminded, especially condition of rail cars in the outside lane of Java is needed rejuvenation. In fact, transportation train there was already one of the main transport. Not only transport passengers but also the transport of goods. With this potential, the bank is very interested in providing financing to remember the great potential he gets.

Coal Methane Gas Production in Sangatta I

Based on World Bank data, the potential concentration of Coal Methane Gas is the largest in Borneo and Sumatra. In East Kalimantan, among others, scattered in Berau containing approximately 8.4 TCS, Pasir / Asem 3 TCS, TCS Tarakan 17.5, and 80.4 Kutai TCS. Barito regency, Central Kalimantan, has a 101.6 TCS, TCS 52.5 Central Sumatra, South Sumatra 183 TCS, and TCS 3.6 Bengkulu, Jatibarang (West Java) 0.8 TCS, and TCS Sulawesi 2.
Coal Methane Gas Production in Sangatta I
The results of drilling the first wells in the block of coal methane gas (coal bed methane / CBM) Sangatta I, East Kalimantan, reaching 12 m3/ton or 424 SCF / ton per day and planned to start production in early 2011 to come.

According to the Chief Executive Officer (CEO) Ephindo CBM Holdings Inc (Ephindo) Sammy Hamzah, at 2011 production targets inline with Government targets CBM production early 2011. Total gas that can be produced on the 12 m3/ton or 424 standard cubic feet (standard cubic feet / SCF) per ton.
The results of initial production will be supplied to meet the needs of gas plants. Faster production in accordance with government regulations if the gas should be produced before the development plan (plan of Developmental / PoD) is complete.

Block Sangatta developed by the consortium of PT Pertamina Upstream Energy with Energy Methane A Sangatta West Kalimantan CBM Inc., Ephindo subsidiary, with a commitment value of the first 3-year contract worth U.S. $ 7.7 million. Blok ini memiliki cadangan CBM terbesar yakni 6,49 triliun kubik standard (TCS). This block has the largest CBM reserves of 6.49 trillion standard cubic feet (TCS).

After Sangatta, CBM in Indragiri Hulu with Prima Mineral Samantaka as operator with the South Sumatra basin that have the resources TCS 5.50. Lowest resource block is located in Sekayu, Medco SBM Sekayo as operators with the South Sumatra basin with TCS 1.70.

Reserve Coal Bed Methane (CBM) Indonesia's current 450 that is large enough spread in TCS and 11 basin Greatest potential lies in the Barito area, East Kalimantan, which is approximately 101.6 TCS, followed by approximately 80.4 Kutai TCS.

Oil price assumptions would Modified

The government will change the oil price assumption in the Budget Revenue and Expenditure Changes (Revised) 2010. The price of oil will be changed from U.S. $ 65 to U.S. $ 77 per barrel. Finance Minister Sri Mulyani Indrawati said the changes are based on recent developments and prospects of world economic recovery. "Once shoot over to the figure of U.S. $ 80 (per barrel) was too fast. From U.S. $ 70 per barrel suddenly to U.S. $ 80. So that U.S. $ 77 was somewhat accurate and not over-shoot too high. But it is also high enough to capture changes in oil prices, "explained the minister, on Friday (19 / 2).

Currently, the position of world oil prices in a position US79, 06 per barrel. The price is the highest position in the past month. From the beginning of the year 2010, the position of the oil price in the range of U.S. $ 74 per barrel.

With the assumption of unchanged dollar is Rp9.500, then inflation will change from 5 percent to 5.7 percent. "Maximum 6 percent," said Sri Mulyani.

While the Interest Rate for 3-month Bank Indonesia is expected to reach 7 percent of the initial position is only 6.5 percent.

With this assumption changes the oil, the minister continued, will also impact the revenue the state. Expected to affect approximately Rp9 trillion to the national revenue. "That's the price of oil and the exchange rate perubhan against inflation," he said.

Revised filing to the board in 2010 is expected to be done on or after April will recess the House of Representatives. For economic growth, the government admitted to not make changes. 2008 and 2009.

Keep Government Assumption 5.5 Percent Economic Growth in Budget-P (APBN-P)

Finance Minister Sri Mulyani said the government still will submit the assumption of 5.5 percent economic growth in budget revenue and spending changes (Budget-P) in 2010. Because the level of consumption in December and January and quite good, there is the threat of inflation expectations high enough to make consumer purchasing power, or will be disturbed.

"If we keep (assuming economic growth) 5.5%. Even if the 6% based on fourth quarter results, especially past a pretty optimistic," said Finance Minister as the Cabinet met after the Assembly in his office on Thursday (18 / 2).

Finance minister added, meaning that the growth components derived from external factors, exports and imports are not as bad as expected."Then the investment also increased, although still at a very low level of only 3% growth," he explained.

Because about that, in order to grow at rates above at least 6%, it will require an investment growth is possible at the range of 7% to 8%.

The government will also see the consolidation of the banking sector to determine the economic growth assumptions.

Riau Arlines halts flights to Jakarta

RAL launched its Pekanbaru-Jakarta route in December 2008 when Samudra Sukardi, a brother of former state enterprises minister Laksamana Sukardi, was its president director.

Riau Airlines (RAL), one of regional players in the country’s aviation industry, has terminated its Pekanbaru-Jakarta route, citing continual losses as a result of the tight competition.

For its future business, Teguh said RAL would focus on its commercial flight services in Sumatra. The company recently opened a new route to Jambi and will fly to Palembang in the near future.

RAL fleet now comprises two RJ-100 and five Fokker-50 planes.

Teguh said the company might resume flights to Jakarta when it could buy big airplanes.

thejakartapost

Garuda to go public in Q1 of 2010

State SOE Miister Mustafa Abubakar said the government would privatizate state airline company PT Garuda Indonesia through an initial public offering in the first quarter of 2010.
“Let’s pray for positive market response, so that the shares that we sell will meet our target,” Mustafa said during the launch of a green campaign involving Garuda and Leuser International Foundation in Banda Aceh on Saturday.

Garuda will privatize 25 percent of its shares to raise US$300 million it needs to buy new planes and improve services.

Garuda president director Emirsyah Satar said the company would purchase nearly 50 planes to strengthen its fleet of 67 planes by 2014.

The national flag carrier is one of three state enterprises that will go public this year. The other two companies are steel producer PT Krakatau Steel and construction company PT Pembangunan Perumahan.

Source: thejakartapost

Pertamina secures $700m in loans to fund investment

State oil and gas firm PT Pertamina Thursday secured US$700 million in a consolidated loan from a consortium of eight banks, to bump up capital spending next year by 77 percent from a year earlier.
Ferederick Siahaan, Pertamina’s finance director, said the loan commitment was signed on Thursday afternoon at Pertamina’s headquarters in Jakarta. The eight banks are BNP Paribas, ANZ, HSBC, RBS, BCA, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Sumitomo Mitsui Banking Corporation, and Panin Bank.

Ferederick said the loan with a tenure of five years is at the LIBOR interest rate plus 2.5 percent.
“The loan is part of the external financing for Pertamina’s capital expenditure in 2010,” Ferederick told reporters on the sideline of the 52nd Pertamina anniversary ceremony.

Ferederick had said that Pertamina’s capital expenditure would increase from Rp 22 trillion (US$2.3 billion), which was the company’s spending target in 2009, to Rp 39 trillion in 2010. “About Rp 26 trillion of this will be used for upstream activities,” Ferederick said on Nov. 12.

Pertamina is expected to launch more aggressive production activities next year.

President director Karen Agustiawan said the company expected to boost its oil production target to 193,900 barrels of oil per day next year, a 10.93 percent increase on the oil production target in 2009.

Ferederick said that, as much as $2.5 billion of the capital expenditure planned for next year would be financed from external sources, including the $700 million consolidated loan secured by the firm on Thursday.

He added that Pertamina expected to sign another $300 million consolidated loan next week.
“The loan will be from Bank Mandiri and Bank Rakyat Indonesia [BRI],” Ferederick said.

Earlier he said that Pertamina was also considering a proposal to issue $1 billion in dollar-denominated bonds and Rp 1 trillion in rupiah-denominated bonds.

Ferederick said Pertamina had already sent out requests for possible underwriters. “We expect to conduct the beauty contest this month,” he said.

He added, the firm could only issue the bonds after the financial audit for 2009 was completed, so as to base the issue on the latest audited figures, which would be available by March or April next year.

source : Alfian|Thejakartapost.com|Business

Steel makers to avoid prolonged downturn

The Jakarta Post reported that the metal, iron and steel industries expect costs to fall and demand to level up next year, helping manufacturers to avoid continued contraction triggered by the 2008 global economic crisis.
The metal, iron and steel industries expect costs to fall and demand to level up next year, helping manufacturers to avoid continued contraction triggered by the 2008 global economic crisis.

Given extremely poor sales conditions and sky rocketing production costs, the extent of the contraction reached 7.19 percent year-on-year in the third quarter of this year. But there is likely to be a turn for the better next year.

The industry ministry said it expects up to 2.75 percent growth in sales by the end of 2010.

Mr Ansari Buchari steel ministry's director general for metal, machinery, textile and miscellaneous industries said that "We expect conditions will get back to normal in 2010, with more balanced costs and production structures."

Improvement in global market conditions, Ansari said, would help the basic metal, iron and steel industries to grow beyond 2 percent next year even though producers spent only limited amounts on new investment this year.

He said that improvement in global market conditions would help the basic metal, iron and steel industries to grow beyond 2% next year even though producers spent only limited amounts on new investment this year.

Investment by the big players, he said, would soon start with the signing of an agreement next week between state-owned steelmaker PT Krakatau Steel and South Korean steelmaker Pohang Iron and Steel Company (Posco) to build a new US$5 billion steel factory in Cilegon, Banten.

The factory is expected to produce 2.5 million tons of steel slabs and steel billets pear year in the first phase of operations.

Mr Hidajat Triseputro executive director of Indonesian Iron & Steel Industry Association said that the slump in global demand had forced many manufacturers to run on as little as 30% to 40% of their production capacity. He added that "Our utilized capacity has been only 30% to 40% since the third quarter of last year, in contrast to 70% of utilized capacity in the second quarter of 2008."

Mr Hidajat said that apart from enjoying a positive trend towards favorable global market conditions, steel producers were also hoping to benefit from the government's increased support for infrastructure projects starting next year. He added that "That is where our hope lies. With infrastructure projects running, there will be many steel manufacturers positively affected. Infrastructure and toll roads need steel."


Hidajat said apart from enjoying a positive trend towards favorable global market conditions, steel producers were also hoping to benefit from the government's increased support for infrastructure projects starting next year.

"That is where our hope lies. With infrastructure projects running, there will be many steel manufacturers *positively affected*. Infrastructure and toll roads need steel," Hidajat said.

However, he also warned of a possible rush of steel imports next year, when a free trade agreement between Association of Southeast Asian Nations (ASEAN) and China begins to come into effect, which will include steel (among other products).

He said the association was gathering information after recent indications of increases in steel imports.

The Central Statistics Agency (BPS) recorded that imports of iron and steel increased from US$279.6 million in July to $364.5 million in August and $434.1 million in September; and imports of iron and steel products stood at $237.5 million in July, $239.3 million in August and $184.4 million in September.

However, between January and September, overall imports of iron and steel declined from $6.6 billion last year to $2.7 billion this year and imports of iron and steel products declined from $2.4 billion last year to $2.1 billion this year, the BPS says.

Sourced from : Mustaqim Adamrah |www.The Jakartapost.com|

PT Pertamina plans to spend Rp 39 trillion ($4.15 billion) in 2010

State oil and gas company PT Pertamina plans to spend Rp 39 trillion ($4.15 billion) in capital expenditure in 2010, up by about 77 percent on this year's estimated spending, a director said Thursday.

Ferederick ST Siahaan, Pertamina's finance director, said the company's capital expenditure would increase from Rp 22 trillion, which is the spending estimate for this year, up to Rp 39 trillion in 2010.

"This is our prediction, but we still need approval from the shareholder meeting," Ferederick ST Siahaan, finance director, said.

He added that as much as $2.5 billion of the spending would be secured from loans, including from $1 billion of global (dollar-denominated) bonds and Rp 1 trillion of rupiah-denominated bonds.

"We can only issue the bonds after the financial audit for 2009 is finished. Thus, this will perhaps be in March or April next year," said Ferederick, adding that this was also subject to shareholders' approval.

Pertamina plans to use around Rp 26 trillion, about 66.67 percent of the planned capital expenditure in 2010, investing in upstream activities, he added.

Pertamina president director Karen Agustiawan said the company expected to boost oil production by 10.93 percent next year. The company estimates that it will produce 174,000 barrel oil per day (bopd) this year.

"We expect to increase the production target to 193,900 bopd in 2010," Karen said.

Karen added that the Cepu block was expected to contribute significantly to the targeted oil production increase in the coming year.

"We expect that the Cepu block will start its early production of 20,000 bopd by the beginning of 2010. Of this production, Pertamina expect to get 9,000 bopd," Karen said.

As for gas production, Pertamina expects to increase production from 1,314 million standard cubic feet per (MMSCFD) of gas, which is the 2009' gas production estimate, to 1,370 MMSCFD in 2010.

Ferederick said that Pertamina would also use part of the planned capital spending upgrading existing refineries and on the construction of new refineries.

In the period 2012 to 2016, Pertamina plans to upgrade production capacity at the refineries in Plaju, Cilacap, Balikpapan, Dumai, and Balongan.

It also plans to construct three new refineries, namely the Blue Sky Cilacap refinery in Cilacap, Central Java; the Banten Bay refinery in Banten; and the East Java refinery.

Ferederick said these upstream projects would require investment finance of between $17 billion and 19 billion. "The finance will be prepared next year," he added.

Pertamina has been the most profitable state owned company. This year, the company expects to book as much as Rp 15.39 trillion in profits, a major fall on the Rp 30.195 trillion booked by the firm in 2008, reflecting earlier higher oil prices.

(Alfian , The Jakarta Post)