China Merchants to help build $2b Batam port
Indonesian state-owned port operator Pelindo II will in July sign a memorandum of understanding with China Merchants Holdings (International) Co to develop a US$2 billion container and iron-ore transhipment terminal in Tanjung Sawuh, Batam.
Pelindo's president director Richard Joost Lino said China Merchants was prepared to become the majority investor in the port, which will have a capacity of four million TEUs and be able to process 100 million metric tonnes of iron ore a year, reported Dow Jones Newswires.
Both a spokeswoman and a deputy general manager for China Merchants declined to comment on possible investments in Indonesia.
The spokeswoman said the company is constantly looking at investment opportunities overseas but doesn't comment on individual cases.
Executives at China Merchants previously said the Chinese port operator was looking at investment opportunities in emerging markets. According to the company's website, its managing director, Hu Jianhua, met with Lino during a visit to Indonesia in early May.
Lino, speaking at a business seminar, said Tuesday that construction of the port in Batam will begin in 2013 and finish by 2016.
Indonesia is striving to improve vital infrastructure, such as seaports and roads, across the country in order to lure foreign investment.
Construction of a port in Sorong, West Papua, is set to begin later this year, with an initial capacity of 700,000 TEUs, Lino said.
In July, construction of the first phase of the Kalibaru Port in North Jakarta, will also start, adding a capacity of 4.5 million TEUs next to the country's busiest port, Tanjung Priok, he said.
The first phase of construction is expected to be completed in 2014 at a cost of $2.4 billion. Tanjung Priok last year surpassed its operating capacity of five million TEUs, according to Pelindo.
