Poland to invest US$400 mln in South Sumatera coal project

Jakarta (ANTARA News) - Polish investors are preparing to sink US$50 million in South Sumatra`s Air Laya coal project in Buki Asam and are also interested in a US$350 project to build a 90-km railway track to connect economic centers in the province, the Foreign Ministry said.

An official statement issued by the Foreign Ministry here on Tuesday said the Polish investors` intention to invest in South Sumatra surfaced during a meeting between Indonesian Ambassador to Poland Hazairin Pohan with a Polish investor, FAMUR International Trade SB, in Warsaw last week.

The mining area of the Air Laya project was initially an open pit mining area but now the project has turned to be an underground mining at a depth of about 100 meters.

It was believed that at a depth of 150 meters there were coal deposits with high quality.

The Indonesian ambassador and FAMUR S.A. are holding talks with the Polish government on the funding scheme of the US$50 million worth project.

"Ideally the funding is in the form of soft loans provided by the Polish government. Based on a G-to-G investment format, projects of this kind could be financed with soft loans in a binding assistance project form," Ambassador Pohan said.

He said that the Polish government had expressed its readiness to finance the project. The Polish government`s readiness was reached in a meeting between the ambassador and the Polish finance minister sometime ago.

FAMUR S.A is not a new player in Indonesia because it has so far cooperated with a number of foreign investment companies, for example, in the Barito Line project in Central Kalimantan worth one billion US dollars.

FAMUR is also preparing to mine nickel and copper in various regions in Indonesia.

Other Polish mining company, KOPEX SA, is negotiating a business scheme worth US$1 billion for a coal mining project and the development of a steam-fired power plant (PLTU) in South Kalimantan.

Together with its partners, KOPEX is expected to sign an initial contract woth US150 million.

Accoring to temporary results of KOPEX`s survey, South Kalimantan now sits on an area which keeps about 250 million tons of coal deposits. (*)
Source: antara.co.id