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SDK and Antam Decide to Build Chemical Alumina Plant in Indonesia

Showa Denko K.K.
August 31, 2010

Showa Denko K.K. (SDK) and PT. Antam Tbk (Antam), of Indonesia, have agreed to start building a chemical alumina plant in West Kalimantan, Indonesia, as from January 2011. The decision has been made based on the results of a joint feasibility study. The new plant will be completed in December 2013, and operations will start in January 2014. The project cost is expected to total approx. US$450 million (approx. ¥40 billion).

The plant will have the capacity to produce 300,000 t/y of chemical alumina. SDK will take 200,000 t/y and Antam 100,000 t/y. While SDK is currently producing 200,000 t/y of chemical alumina at Yokohama, the company has decided to terminate disposal of bauxite residue into the sea by the end of 2015 and withdraw from the chemical alumina production at Yokohama. Thus, SDK will use the 200,000 t/y of products from the new plant to replace the current products from its Yokohama Plant.

PT Indonesia Chemical Alumina (ICA), which is owned 80% by Antam and 20% by SDK, will operate the plant. Antam, which owns a mining right, will supply bauxite to ICA, while SDK will provide the chemical alumina manufacturing technology. It has been decided that a consortium* led by Tsukishima Kikai Co., Ltd. will be awarded the contract for the construction of the new plant.

Aluminum hydroxide, an intermediate product in alumina production, is used as coagulant for water purification. While alumina is widely used for the smelting of aluminum metal, alumina is also used for the production of functional materials and electronic materials. The term “chemical alumina” refers collectively to aluminum hydroxide and alumina for applications other than aluminum smelting. Chemical alumina from the new plant will be supplied to SDK’s existing customers, and to new markets in Indonesia and its neighboring areas for water purification and other applications.

SDK is managing its operations with the goal of contributing to the sustainable growth of society and giving satisfaction to customers. With the construction of the new chemical alumina plant in Indonesia, SDK will meet the needs of its existing customers and create new business opportunities in the growing Asian market.

*A consortium consisting of the following three firms:
Tsukishima Kikai Co., Ltd.: To serve as the project leader (based in Japan)
PT Wijaya Karya (Persero) Tbk: Indonesia’s state-owned comprehensive construction company
PT Nusantara Energi Abadi: A boiler installation/maintenance company in Indonesia

[Reference]

Outline of P.T. Indonesia Chemical Alumina

Established in February 2007
President: Mr. Hendra Santika
Capital: 31.9 billion rupiah (approx. US$3.5 million)
Shareholders: PT. Antam Tbk (80%); SDK (20%)

Outline of PT. Antam Tbk

Head office: Jakarta, Indonesia
Established in July 1968
President: Mr. Alwin Syah Loebis
Capital: 8.6 trillion rupiah (approx. US$950 million)
Shareholders: The Indonesian Government (65%), and others
Scope of business: Mining, processing and exporting of gold, nickel, bauxite and other minerals

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IR & PR Office (Phone: 81-3-5470-3235)