Papua will build its first cement factory with an annual production capacity of 1Mt in 2010, the Indonesian regional administration said.
Papua Governor Barnabas Suebu said the project will cost Rp2.7trn (US$270m), adding cement demand is growing in that region.
Barnabas said Freeport Indonesia, the US company operating the country’s largest copper and gold mine in that region has agreed to contribute Rp1 trillion to the total investment and the rest is expected to come from other investors.
The project is still in the pipeline, he said giving no further details.
The factory is expected to reduce the price of cement in the country’s most backward region, chairman of the Indonesian cement association Urip Timuryono said.
Urip said the price of cement in Papua is around twice more expensive than in Java because of the high transport cost from producing regions.