Indonesia: PT Semen Gresik has announced plans to build a new 0.6Mt/yr, US$133m integrated cement plant at Manokwari in Papua. Company CEO Dwi Sutjipto said that Semen Gresik wanted to 'dominate' the cement market in Indonesia's eastern regions.
The plant will be commissioned in 2014 after the installation of a new packaging plant in the region, which is expected be commissioned by August 2012. The company has announced ambitious plans to develop a large number of new packing plants in strategic areas along the archipelago with the aim of improving product distribution and consequently cutting logistics costs. "Currently, Semen Gresik has 18 packing plants. We hope to have 16 to 17 more in the next five years to lower distribution costs," said Semen Gresik's finance director Ahyanizzaman, who added that each of the 0.2-0.3Mt/yr plants would require an investment of about US$10m.
Semen Gresik expects to complete the construction of at least four packing plants in 2012, with ongoing packing-plant projects at Sorong in Papua, Banyuwangi in East Java, Banjarmasin in Kalimantan and Balikpapan in Riau. "The packing plant in Banyuwangi is almost finished and the Papua plant is about 50% complete. Meanwhile, we are ready to construct the plants in Kalimantan. We expect to build in more areas in Kalimantan but we remain constrained by land acquisition," added Ahyanizzaman.
New packing plants are part of Semen Gresik's effort to improve its distribution, especially in areas in eastern Indonesia, which frequently face delivery hurdles leading to higher cement prices. Each packing plant will bag cement sent from its closest Semen Gresik factory.The Sorong plant, for example, will process cement produced by Semen Gresik's factories in Sulawesi. The packing plant will have a capacity of bagging 0.6Mt/yr. The company is investing around US$22.2m= in the Papua packing plant, which will be supported by a 10,000t silo and a 150m harbour.
The finance director also said that he expected Semen Gresik to increase its revenue by 10-12% in 2012 due to the new plants and ongoing work on integrated facilities at Tuban and Tonasa. The company forecasts a more moderate increase in its net profit due to its capital expenditure. "We estimate a growth of 1-2% in net profit in 2012 compared to 2011," said Ahyanizzaman. "The slight increase is due to the new factories producing below their full capacity."
