Australian Company to Build Explosives Factory in Bontang
Wednesday, 11 October, 2006 | 13:45 WIBTempo Interactive
, Jakarta: Orica Ltd, an Australian chemical company, will build an ammonium nitrate explosives factory with an investment value of US$200 billion.
The factory, with a yearly capacity of 350,000 tons, according to Orica’s CEO Philip Etienne, will be located in Bontang, East Kalimantan.
He said the factory could cover the need explosives demand of the national mining industries, which have been imported up to now.
“We are targeting that the factory will start operating in 2012,” said Etienne.
At the moment, Orica is carrying out the final examination of 10 hectares of land in the Bontang industrial region for the factory location.
Afterwards, the building of production facilities will be started.
In the initial phase, said Etienne, Orica will manufacture 150 thousand tons of ammonium nitrate before increasing production to the final capacity of 350,000 tons.
The supply is intended for Indonesian mining companies that have imported explosives from China and Australia up to now.
“However, it is possible that they could be exported, taking into account that the demand for this commodity is increasing,” he said.
As regards the supply of raw materials, he stated that this can be handled by local partners.
Around 150,000 tons of ammonia as the raw material of ammonium nitrate will be supplied by, among others, PT Pupuk Kalimantan Timur.
“We are certain that the matter of raw materials is solved because we have good relationships with local manufacturers,” said Etienne.
John Fetter, Orica's Group Manager of Corporate Affairs, added that his company has complied with security conditions both in the manufacturing process and product distribution.