Australian won’t bow to Papua pressure, FM says

Foreign Minister Bob Carr says Australia has been “explicit” in its support for Indonesia’s sovereignty over Papua.

Australian Foreign Minister, Bob Carr

Senator Carr told Newsline the provinces have been recognised “by all the nations in the earth” as Indonesian territory.
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“There are Australians, a very small number I think…who take an interest in the notion for more autonomy for Papua but I remind them that you’d be doing a disservice to the Indonesian population of those two provinces if you held out any hope that Australia could influence the cause of events,” he said.

The Foreign Minister has dismissed suggestions public pressure would cause Australia to change its policy on Papua’s autonomy.

“I just ask those idealistic Australians who might entertain some other arrangement, that what would be the cost in terms of our friendship with Indonesia and in terms of our budget of a different arrangement.

“It’s inconceivable, utterly inconceivable.”

‘Australians seen as Asians’

The Foreign Minister says Australia’s relationship with Indonesia involves a “habit of consultation” – a relationship it enjoys with a number of its Asian neighbours including Japan, South Korea and Singapore.

“We had the Singaporeans through in recent weeks and again we have common approaches to issues like the South China Sea, he said.

“A comfortable alignment of our foreign policy positions.”

He also countered criticisms Australia’s perceptions of Asia are superficial and too “Eurocentric” in response to the recently-released Asian Century policy paper.

“The foreign minister of Myanmar was through here last week and he said..’We see Australia as Asians’,” he said.

“Why wouldn’t he? We were there in Myanmar lifting, not just suspending our sanctions.”

Senator Carr says the fact Australia won a seat on the United Nations Security Council is also testament of its strong relationship with its neighbours.

“I was struck by this when I stood there in the UN and I was being congratulated by nations from every region in the world and it dawned on me that they’re comfortable with Australia and that reflects our diplomacy,” he said.

Source: Australia Network News

Pupuk Indonesia plans $5.2 bln petrochem complex in Papua

Indonesian fertilizer firm PT Pupuk Indonesia plans to build a petrochemical complex worth $5.2 billion in the country’s Papua region, an official said on Wednesday (19/04).

Investors from Japan, South Korea and Germany have expressed interest to take part in a plant that will have annual capacity of 2 million tonnes a year, said the firm’s CEO Arifin Tasrif.

“We want to be the majority (owner) in a joint venture company,” Tasrif said, without giving details on the timeframe for the plant.

Indonesia, Southeast Asia’s largest economy, is seeing strong economic growth of over six percent and the government is keen for investors to expand the petrochemical industry to make higher value products from the country’s oil and gas output.

Papua, a remote and mountainous region in eastern Indonesia home to BP’s ‘s Tangguh liquefied natural gas plant, sees high costs for construction and businesses because of the expense in transporting materials from the country’s main industrial centres on Java island.

Pupuk Indonesia, a holding firm of four state-controlled fertilizer firms, already has plants in west and east Java, in Kalimantan on Borneo island and Aceh in Sumatra island, with a total capacity of 12 million tonnes.

The firm expects sales in 2012 to reach 45 trillion rupiah ($4.90 billion), up from last year’s 40 trillion rupiah.

*($1 = 9,180 rupiah)

Source: Reuters

New petrochemical estate for West Papua

The government plans to build a petrochemical industrial estate in West Papua next year to help meet rising demand for petroleum-based products and reduce dependency on imports, officials say.

Industry Minister MS Hidayat said on Thursday (15/03) that a master plan was being drafted and would soon be followed by a feasibility study.

“We have a potential space of 400 hectares there. The gas supply for the industry can be sourced from the Tangguh field,” he told reporters at his office in Jakarta.

The master plan, which maps out the infrastructure and funds required for the development, should be completed by October, according to Industry Ministry director general for industrial regions development Dedi Mulyadi.

British Petroleum has already expressed an interest in investing in the estate, he added.

Other investors submitting proposals include state-owned fertilizer firm PT Pupuk Sriwijaya (Pusri) and foreign investors, including some from South Korea, Japan and Germany, the ministry’s director general for manufacturing-based industry Panggah Susanto said.

The investment needed for the project might total US$4.3 billion, with $800 million spent on building a methanol plant, $500 million for a polyprophylene plant, $2 billion for ammonia- and urea-fertilizer plants, and $1 billion for building utilities and port facilities.

The ministry has consulted the Energy and Mineral Resources Ministry (ESDM) over the necessary gas supply for the project.

“We have requested, to the ESDM, the gas and once there’s certainty about the gas supply, we can start the project,” he said.

According to Industry Ministry estimates, the first phase of the petrochemical industrial estate will require around 382 million standard cubic feet per day (mmscfd) of gas to fuel two urea plants with a total production capacity of 3,500 tons per day, two ammonia plants with a production capacity of 2,000 tons per day and a methanol plant.

Meanwhile, the second phase of the project will need around 200 mmscfd of gas to develop a diesel plant.

“We should begin soon, as the gap between local production and imported materials has been higher than consumption (of petrochemical products) by industrial sectors, such as packaging and automotive industry that continue to surge,” Panggah said.

Industry leaders have agreed that the development of an integrated petrochemical industrial estate will help reduce production costs for olefin, aromatic and fertilizers.

Overseas, as well as local, firms have geared up to realize investment in the sector as demand for petrochemicals is predicted to rise in line with the country’s economic growth.

In the next year, companies plan to invest about $26 billion in the industry.

Source: The Jakarta Post

China to offer $4 billion for Indonesian infrastructure

China to invest up to $200 million to build a cement factory on Indonesia’s Papua island and may invest in power plants there.

China Investment Corp plans to offer $4 billion of loans for Indonesian infrastructure, part of a package of deals Indonesia is hoping for during a visit this week by Chinese Premier Wen Jiabao, Indonesian officials said on Thursday.

The plans by the $300 billion wealth fund are likely to be announced during a two-day visit to Indonesia by Wen, due to arrive in Jakarta later on Thursday in an effort to boost bilateral trade and gain access to the archipelago’s resources.

“CIC plans to provide about $4 billion in the form of loans to Indonesia’s infrastructure projects…and the loans are supposed to be for Indonesian firms,” Gita Wirjawan, Indonesia’s investment chief, told Reuters.

In addition, Bank of China and and Industrial and Commercial Bank of China plan to lend several billion dollars to Chinese firms for investing in Indonesian industry, Agus Tjahajana of the industry ministry, told Reuters.

Indonesia is trying to attract over $100 billion from investors to overhaul poor infrastructure among its 17,000 islands, while China is on a global hunt to secure long-term resource supplies to fuel its fast-growing economy.

So far Chinese infrastructure investment in Indonesia has lagged that from other Asian countries such as Japan, South Korea and India, though China is the largest trading partner for Indonesia, the world’s top exporter of coal for power plants.

Wirjawan said China’s State Development and Investment Corp, a state-owned investment holding firm, also plans to invest up to $200 million to build a cement factory on Indonesia’s Papua island and may invest in power plants there.

This would be the first cement factory on Papua, cutting construction costs in a province lacking infrastructure but home to the world’s largest gold mine, huge natural gas deposits and forests that the government wants to turn into food plantations.

Source: Reuters