PT Semen Andalas Indonesia, a unit of Lafarge SA of France, said it has started reconstruction of a cement plant that will have capacity of 1.6Mta.
The plant is located at the company’s old facility in Lhoknga, Aceh province, which was devastated by the 2004 tsunami which struck the province.
The company said it has also launched the operation of a cement packing unit and port in Lhoknga at a costs of US$17m.
It said total investment for the packing terminal, the new 1.6Mt cement plant and a coal-fired power plant amounts to US$150m.
Meanwhile, Industry Minister Fahmi Idris urged business circles to make new investment in cement industry as national demand for cement may continue to grow in the future.
In keeping with national infrastructure development which may flourish in the years to come Indonesia will need a national cement capacity of 50 million tons in 2010, the minister said when he inaugurated a cement packing firm of PT Lafarge Semen Andalas Indonesia (SAI) in Lhok Nga, Aceh Besar district, on Thursday.
With the resumption of PT SAI operation national cement production capacity will increase to 47.69 million tons in 2008, surpassing national demand standing at 40Mt.
Meanwhile, Lafarge Cement Indonesia president director Marcel Cobuz said the redevelopment of PT SAI will raise production capacity from 1.4 million tons to 1.6Mta.
PT SAI has been redeveloped at a cost of US$150 million, he said adding that it is the largest investment in Aceh.
Cobuz said 80 percent of PT SAI redevelopment has been carried out by Indonesian firms and the remaining 20 percent by a Chinese construction company. PT SAI redevelopment is scheduled to be finished in 2008.
Lafarge Cement Indonesia co-president Guillaume Roux said the redevelopment of PT SAI has been delayed as the removing of a barge which was swept away to Lhok Nga beach by December 2004’s tsunami was time consuming.
Roux said a tsunami early warning system had been installed at PT SAI.