PT Semen Tonasa (Indonesia) - a subsidiary of PT Semen Gresik Tbk -plans to boost production capacity by 2.5 million tons per annum this year by starting the construction of unit V of its plant, reports Bisnis Indonesia.

 

The company will spend a total investment of US$318 million on the new project in South Sulawesi.

 

"The ground breaking will take place in April 2009," said Director of Downstream Chemical Industry at the Department of Industry Tony Tanduk yesterday.

 

According to him, the company started the construction of Tonasa Unit V earlier this year.

 

Based on the company’s master plan, the Tonasa V unit would use machineries bought from Europe at US$150 million and from China at US$125 million.

 

"The total amount of investment can reach IDR3.5 trillion," he said.

 

He added it would take around three years to develop a new cement plant. Therefore, Tonasa V is expected to start production by the end of 2011 or early 2012.

 

Another subsidiary of PT Semen Gresik Tbk, PT Semen Padang, also planned to develop a new plant of Indarung VI, which will have an annual production capacity of 2.3 million tons. However, the project was still being curbed by environment problems.

 

"One of the problems faced by the Indarung VI project is the area where the raw material is located is considered as part of protected forest area. The board of directors is currently discussing the issue with the Department of Forestry," he said.

 

He continued PT Semen Andalas would also develop a new plant by the end of the year with a total production capacity of US$175 million. "Their old plant was once hit by tsunami. They plan to do the reconstruction work by the end of the year."

Published under Cement News