Tonasa To Meet 40 Pct Cement Need In Eastern Indonesia

News Focus - TONASA TO MEET 40 PCT CEMENT NEED IN EASTERN INDONESIA By Andi Abdussalam Jakarta, Feb 20 (Antara) - Infrastructure and economic development in Indonesian eastern regions can now get further boost after the operation of a new unit of state-owned cement factory PT Semen Tonasa in South Sulawesi province. With the completion of its Unit V cement factory, PT Semen Tonasa which was inaugurated by President Susilo Bambang Yudhoyono in Pangkep District, South Sulawesi, on Wednesday, could now produce a total of 6.7 million tons of cement per annum and supply 40 percent of the need for cement in Indonesian eastern regions. PT Semen Tonasa, a subsidiary of publicly listed state-owned PT Semen Indonesia is expected not only to serve as a machine of development growth in Indonesia`s eastern regions but also as producer of commodity which is able to face competition in the ASEAN Economic Community next year. State Enterprises Minister Dahlan Iskan stated that cement commodity produced by Indonesia was ready to face free markets such as the ASEAN Economic Community in 2015. Dahlan claims that what President Susilo Bambang Yudhoyono had decided to merge Indonesia`s major cement companies into PT Semen Indonesia, has laid an important strategy in the development of cement business in the country. Major cement producers PT Semen Padang, PT Semen Gresik and PT Semen Tonasa were merged in 2013 into PT Semen Indonesia as their holding company. With the merger of the major cement companies, publicly listed PT Semen Indonesia has become the biggest cement producer in Southeast Asia, which is ready to face the AEC in 2015. Thus, the operation of PT Semen Tonasa generates the economic development, particularly in the eastern part of the country. In fact, cement companies in Indonesia are expanding their production in an effort to meet increasing domestic demand amid the country`s efforts to accelerate its infrastructure development through its mater plan for acceleration and expansion of its economic development scheme. Along with the infrastructure development, demand for cement at home is expected to increase by about 10 percent this year. President Susilo Bambang Yudhoyono has predicted that Indonesian cement industry will be brighter in the future because of a whole lot of thorough preparations that have been made. "Following thorough preparations that have been made, the opportunity for our cement industry in the future will get brighter," President Yudhoyono stated, while inaugurating the cement factory. Therefore, holding company PT Semen Indonesia has set a sales target of 31 million tons of cement in 2014, up from that in 2013 which was estimated at 27.95 million tons. PT Semen Indonesia President Director Dwi Soetjipto said his company has set the sales target based on cement market growth forecast at 6 percent in 2014. "In 2014, we will continue to focus on maintaining our market share at a range of 44 percent. To support the plan, the company had worked out a number of strategies," Dwi was quoted by Prepos,co.id online media as saying. At present, PT Semen Indonesia, a holding company of PT Semen Gresik, PT Semen Padang and PT Semen Tonasa, controls 41 percent of the cement market share at home. The cement sales of PT Semen Indonesia, which is a state-owned firm, reached 22.5 million tons in 2012, up 14.7 percent from sales in 2011 which stood at 19.6 million tonnes. As demand for cement steadily increases in the eastern regions of Indonesia, PT Semen Indonesia is now exploring the possibility of building a cement factory in Papua. "We want to build is an integrated cement factory in Papua, but the plan will need a huge investment. So, we will carry out the plan in stages. The first thing we are doing is building a packing plant, while exploring the possibility of building a new factory," Dwi Soetjipto said. Its subsidiary PT Tonasa now is expected to meet 40 percent of the need for cement in Indonesia`s eastern regions. After all, the focus of development of infrastructure is now shifting to the eastern regions, and this could be supported with cement supplies from PT Semen Tonasa in South Sulawesi province. PT Semen Tonasa Corporate Secretary HM Arifin said with the operation of Tonasa`s Unit V factory with a capacity of 2.5 million tons per annum, his company was now able to meet 40 percent of the need of cement in Indonesia`s eastern regions. The construction of the factory which spent a total investment of US$289 million commenced on February 24, 2009. The factory was expanded in an effort to response to the rapid growth of development in Indonesia`s eastern region, he said. In order to support the factory`s electricity need, a steam power plant with a capacity of 2x35 Megawatts was also inaugurated there. The electricity generating plant was built at a cost of US$123 million. It has actually been put into operation since May 2013. With the operation of the power plant, PT Tonasa now has its own electricity generators with a capacity of 120 Megawatts. As one of its operating companies, PT Semen Indonesia through Tonasa also developed cement distribution facility namely packing units in a number of regions such as Mamuju Districts of West Sulawesi. The packing unit is expected to be completed in the middle of 2014. It also has a packing unit in Lapuko, Konawe District, Southeast Sulawesi with a capacity of 300 thousand tons per annum. It has been inaugurated in January 2014. Up to now, PT Semen Tonasa already has eight units of cement packing units in Biringkassi, Makassar (South Sulawesi), Palu (Central Sulawesi), Bitung (North Sulawesi), Banjarmasin (South Kalimantan), Samarinda (East Kalimantan), Celukan Bawan and Ambon (Maluku). It is also planning to build ones in North Maluku, Jayapura (Papua) and Gorontalo (Sulawesi).