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Posco to Construct Integrated Steel Mill in Indonesia
12/08/2009 - Posco signs a memorandum of agreement with Indonesia’s state-run steelmaker Krakatau Steel to construct an integrated steel mill with an annual production capacity of 6 million tonnes.
Posco has signed a memorandum of agreement (MOA) with Indonesia’s state-run steelmaker Krakatau Steel to construct an integrated steel mill with an annual production capacity of 6 million tonnes.
At the MOA signing ceremony on November 2, Posco CEO Joon-yang Chung and Krakatau CEO Fazwar Bujang agreed to jointly construct the mill in the Cilegon city, located in the northwestern coast of Java, Indonesia. The first phase of construction, with an annual crude steel production of 3 million tonnes, is expected to begin in the second half of 2011 and to be completed at the end of 2013.
The project will adopt the Brownfield capital investment approach, allowing the partners to fully utilize the existing infrastructure, including harbor facilities, land, industrial water, and power. By building the new plant within land owned by Krakatau Steel, Posco expects to save on initial investment costs and to open earlier.
Posco plans to aggressively review the alternatives to cooperate in various sectors in Indonesia such as infrastructure and energy, said Chung. The company also expects to gain an advantage in price competitiveness by investing in and developing Indonesia’s steel-making resources, such as iron ore and coal.
”We have been maintaining a strategic partnership for some time in the global steelmaking industry, and I believe the success of our new joint project will lay the groundwork for national development of Indonesia,” said Bujang.
At the MOA signing ceremony on November 2, Posco CEO Joon-yang Chung and Krakatau CEO Fazwar Bujang agreed to jointly construct the mill in the Cilegon city, located in the northwestern coast of Java, Indonesia. The first phase of construction, with an annual crude steel production of 3 million tonnes, is expected to begin in the second half of 2011 and to be completed at the end of 2013.
The project will adopt the Brownfield capital investment approach, allowing the partners to fully utilize the existing infrastructure, including harbor facilities, land, industrial water, and power. By building the new plant within land owned by Krakatau Steel, Posco expects to save on initial investment costs and to open earlier.
Posco plans to aggressively review the alternatives to cooperate in various sectors in Indonesia such as infrastructure and energy, said Chung. The company also expects to gain an advantage in price competitiveness by investing in and developing Indonesia’s steel-making resources, such as iron ore and coal.
”We have been maintaining a strategic partnership for some time in the global steelmaking industry, and I believe the success of our new joint project will lay the groundwork for national development of Indonesia,” said Bujang.
