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:: US$850mn Copper Smelter to be Built in East Kalimantan
Three foreign investors are studying possible loan of US$595 million to finance the construction of a copper smelter planned by Nusantara Smelting Corp. (NSC) in Bontang, East Kalimantan.
Ayer Logistic from the United States, Deutsche Bank and United Bank of Switzerland are negotiating a loan proposal with NSC needed to build the smelter, NSC Director Juangga Mangasi said.
The three investors are expected to provide 70 per cent of the fund needed for the US$850 million project, Mangasi told the newspaper Investor Daily.
He said Ayer has agreed to provide a 13-year loan with a flat interest rate of 5 per cent.
Ayer even offers to provide the entire fund of US$850 million and a working capital of US$190 million if it is given a 30 per cent share in compensation during the payback period, he said.
Construction of the project is expected to start in the first half of 2009 and it is to be operational in 2011.
It will have an annual production capacity of 200,000 tons of copper cathode of A quality for which it will need 800,000 tons of copper concentrate.
Mangasi said his company has discussed with Freeport McMoran and Newmont Mining Corps, both U.S. companies having large copper mine concessions in the country.
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