To help meet rising local demand, publicly listed cement producer PT Indocement Tunggal Prakarsa is set to gradually increase its production capacity to 20Mta by 2009 by expanding the capacity of its existing plant in Citeureup, West Java.
Indocement, one of the country’s top three cement producers, currently operates three plants with a total capacity of 15 million tons.
The company’s plant in Citeureup has a capacity of 10Mta, while the other plants, one in Palimanan, West Java, and one in Tarjun, South Kalimantan, can each produce 2.5Mta.
The Citeureup plant, Indocement’s largest, has nine production units, one of which was recently modified to accommodate the expected increase in output.
"We’ll be able to produce 17.1Mt this year after modifying unit 8 of the Citeureup plant at a revamping cost of US$25 per ton," Indocement financial director Christian Kartawijaya said on the sidelines of a breaking-of-the-fast gathering Tuesday.
He said his company planned to invest around $95 million next year, including $30-35 million on the construction of a new cement mill to add 1.2Mt to its production in Citeureup.
"With the operation of the new mill in 2008, we’re hoping to increase our total output to 18.3Mt in 2008,
"And in 2009, we’ll have another mill onstream to bring our overall production to 20Mta," he added.
Christian said that the expansion plan would as necessary in view of the anticipated sharp increase in cement demand over the next few years.
The government has made infrastructure development one of its main priorities for the next few years in order to meet its economic growth target of above six percent per year. This will led to an increase in cement demand.