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This Week’s Highlighted News (August 27, 2010)

Fri, 08/27/2010 - 16:54

PT Dirgantara Indonesia said it expects to win at least 30 percent of the
national market for aircraft maintenance, repair and overhaul (MRO) after it was appointed an authorized provider of spare parts and MRO service for Russian-made Sukhoi Superjets, says the state aerospace company ’s chief. Dirgantara president director Budi Santoso said in Jakarta on Monday that the appointment would allow the Bandung-based airplane manufacturer to handle MRO bids for all variants of the Russian-made aircraft. The company, previously known as Industri Pesawat Terbang Nusantara (IPTN) and Industri Pesawat Terbang Nurtanio (IPTN), recorded sales of Rp 771.63 billion in 2009, returning profits of Rp 117.08 billion after losing Rp 84.34 billion in 2008.
From “Dirgantara eyes big share of MRO market,” The Jakarta Post, Jakarta – 24/08/2010


The Indonesian-based social networking site specially made for the Muslim community, CMnet, had become increasingly popular among Internet users since it was released on August 6, Antara news agency reported.  CMnet that can be accessed at www.cybermoslem.net is the first social networking site for Muslims in Indonesia with the facebook and twitter system combined with edited-opensource system.
From “Muslim Social Networking Site Becomes Increasingly Popular,” Bernama, Padang – 23/08/2010


Indonesia's state oil firm Pertamina has restarted its 230,000 barrels per day (bpd) Cilacap refinery in Central Java, a company source said on Monday, after it was shut in mid-July for scheduled maintenance. The source said Pertamina expects to import less gasoline and diesel in September than in August, following Cilacap's return to production. He gave no details. "Pertamina restarted the 230,000 bpd Cilacap refinery on Saturday (21/08) and it is running at between 60 to 70 percent of its capacity," the source said, adding that the refinery is expected to run at full capacity this week.
From “Pertamina restarts 230,000 bpd Cilacap refinery,” Reuters, Jakarta - 23/08/2010



In the News:




Government Relations & Economic Development

Factory Exports Near Pre-Crisis Levels: Govt
Eny Wulandari. The Jakarta Globe, Jakarta – 27/08/2010

The value of major manufactured exports jumped dramatically in the first half of the year, and the full-year totals could equal those seen in 2008, before the global financial crisis sent the world economy into a tailspin, a senior government trade official said on Thursday.

The Trade Ministry said the value of exports of automotive products, electronics, footwear and textiles all soared during the first half, and were expected to keep climbing.

The automotive sector — covering cars, trucks, motorcycles and parts — grew 47.9 percent year on year, with exports hitting $1.32 billion.

The sector saw $1.73 billion of exports in the whole of last year.

Electronics grew 38 percent in the first half to $4.83 billion,
compared with $8.68 billion for all of last year.
 
Footwear saw more modest growth of 26.1 percent, with first-half exports reaching $1.17 billion, compared with $1.74 billion in 2009.

Textile exports rose 17.4 percent to $4.95 billion, compared with a total of $ 9.26 billion last year.

Deputy Trade Minister Mahendra Siregar said the government expected even better figures in the textile, automotive and electronics sectors by the end of the year.

“We are predicting that textile exports can reach $10 billion by the end of 2010,” he said, adding that such a result would match 2008 levels, when textile exports were $10.14 billion.

Mahendra said the government was optimistic that automotive exports could match the $2.73 billion figure posted in 2008.

“The sector can improve because it is making use of the Asean free-trade agreement,” he said.

Most of Indonesia’s automotive exports go to Thailand, Brazil and Saudi Arabia, with Thailand being the only Asean member.

Mahendra said the government was targeting $9 billion in electronics exports this year as both advanced and emerging countries became bigger importers.

Indonesia sells most of its electronics to Australia, France and the Philippines, which replaced the US, Singapore and Japan as big export destinations.

Textile exports go mostly to the US, South Korea and Turkey, but Indonesia is also eying Italy, China and Brazil as serious customers.

For footwear, Belgium, the United States and Italy have been major buyers since 2005.

Total first-half exports rose 44 percent to $72.55 billion, while imports surged 51.99 percent to $62.89 billion.

Trade Minister Mari Pangestu said on Thursday the economy was expected to grow 6 percent this year and accelerate in 2011.

She was speaking in Danang, Vietnam, where she is attending a meeting of Asean economic ministers.

The pace of expansion in the third and fourth quarters should “continue to pick up,” in part because government spending “is normally much higher in the second half,” Mari said.

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RI may soon become world’s second-largest shoe exporter
The Jakarta Post, Jakarta – 27/08/2010

This is the second part of four stories on Indonesia as an emerging hot spot for foreign direct investment


Indonesia’s footwear industry is gearing up to welcome more investment as the country’s stellar economic performance and its large labor force have made it a new emerging hot spot for foreign direct investment.

The Indonesian Footwear Association (Aprisindo) said that given recent global and domestic investment trends, it expected that by the end of 2011, Indonesia could attract at least 20 major footwear companies to relocate their factories to Indonesia.

Six footwear companies from Taiwan and South Korea have already relocated their factories here from China and Vietnam due to increased labor costs and difficulties recruiting new workers. Of those six companies, four Taiwanese companies are license holders of Nike and Reebok brands, while the remaining two South Korean companies are license holders of Adidas and Geox brands.

“Indonesia is now a very attractive investment destination. With improved infrastructure, I believe that we can invite at least 20 big footwear companies by 2011,” Aprisindo advisory council chairman Haryanto told The Jakarta Post.

Investment Coordinating Board (BKPM) chairman Gita Wirjawan said that with the relocation of the six footwear factories from China and Vietnam, he was optimistic that the country’s footwear exports would reach US$2.1 billion in two years.

He claimed Indonesia could potentially overtake Vietnam and become the second-largest footwear exporter in the world after China in two years.

“I believe we can achieve the target of total export revenue of $2.1 billion because most branded footwear factories [making New Balance, Mizuno, Adidas, Nike and Reebok shoes] export their products,” he told The Jakarta Post.

He added that he was optimistic Indonesia could produce up to 300 million pairs of shoes this year.

The golden era of Indonesia’s footwear industry dates back to before the 1998 financial crisis. Aprisindo claims the country’s export revenue then reached $2.4 billion per year. The industry also employed up to 800,000 workers.

Following the 1998 crisis, the country’s footwear export declined sharply. In 2004, the total export revenue was $1.32 billion, but continued to grow until 2008, when it peaked at a post-crisis high of $1.88 billion.

In 2009, another global financial downturn hit Indonesia’s major footwear export destinations, such as the US and EU and led to a drop in export revenue, which stood at $1.72 billion. Currently, the domestic footwear industry employs slightly more than 400,000 workers.

However, the relocation of the factories from China and Vietnam has boosted the expectation of industry stakeholders that in the next few years, Indonesia’s footwear industry would once again experience a boom.

China and Vietnam, which were previously leading investment magnets, have seen their popularity decline. Numerous labor protests have forced the governments in the two countries to raise wage standards, making them less appealing to investors

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ASEAN economic ministers to conduct joint investment promotions
ANTARA News, Jakarta – 26/08/2010

ASEAN economic ministers have agreed to facilitate investment inflows to the region by conducting joint investment promotion campaigns, the Indonesian Trade Ministry said.

At the 13th meeting of the ASEAN Investment Area (AIA) held in Da Nang, Vietnam, from August 24 to 27, the ASEAN economic ministers also agreed to enhance cooperation in applying good investment practices as part of efforts to attract more investments to the region, the ministry said in a press release issued on Wednesday.

Trade Minister Mari Elka Pangestu and Chairman of the Investment Coordinating Board (BKPM) Gita Wirjawan represent Indonesia at the four-day meeting.

The ASEAN economic ministers also agreed to improve the ASEAN investment climate by asking for inputs from the private sector, the release said.

Besides the AIA meeting, the ASEAN economic ministers also took part in the 24th meeting of the ASEAN Free Trade Arrangement (AFTA) Council which discussed the progress in the implementation of ASEAN Trade in Goods Agreement (ATIGA).

At the meeting of the AFTA Council, Indonesia was represented by Deputy Transportation Minister Bambang Susantono, Director General of International Trade at the Trade Ministry Gusmardi Bustami and Director of Regional Cooperation at the Trade Ministry Iman Pambagyo.

Since AFTA was put into force on January 1, 2010, ASEAN-6 which consists of Indonesia, Brunei, Malaysia, the Philippines, Singapore and Thailand have cut their Common Effective Preferential Tariffs (CEPT) by 99.65 percent, while Cambodia, Laos, Myanmar and Vietnam by 98.96 percent.

ASEAN member states have agreed to cut their tariffs to 0-5 percent. The tariff reduction is an integral part of the ATIGA.

At the meeting of the AFTA Council, each of member states also agreed on the entry into force (EIF) of ATIGA with the period of transition to use certificates of origin (CO) CEPT Form D to CO ATIGA Form D for 12 months or 180 days since the entry into force of ATIGA on May 17, 2010.

As such, the member countries can accept or issue CO CEPT Form D until November 13, 2010. During the period of transition, CO CEPT Form D that have been issued will remain valid for one year according to the Operational Certification Procedure of ATIGA.

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Energy and Minings

Draft Law to Promote Clean Energy Gathering Steam
Muhamad Al Azhari. The Jakarta Globe, Jakarta – 20/08/2010

The new director general for renewable energy at the Energy Ministry is planning to push a draft law that specifically promotes and regulates the development of renewable energy.

If adopted, the law would offer more incentives to renewable energy investors, and would attempt to establish renewable energy industrial zones where factories are built closer to renewable energy sources.

“More than 95 percent of our energy source still come from fossil fuels and only around 5 percent comes from renewable sources,” Luluk Sumiarso, the newly appointed director general, told the Jakarta Globe Wednesday.

“That means we are wasting an enormous amount of the resources that God gave us. But the biggest challenge in developing green energy will be to change the way of thinking.”

Indonesia is hoping to increase green and sustainable energy use in anticipation of fossil fuel shortages expected in the next few decades.

Geothermal, solar, hydro and wind energy, as well as biofuels, are all considered good alternatives, but government legislation on the issue is limited, consisting mostly of new incentive policies proposed by the Finance Ministry earlier this year.

Luluk declined to reveal specific policies included in the draft law, but said it includes “mandatory” measures intended to help the country reduce greenhouse gas emissions.

Because of a lack of legislation and motivation, Luluk said Indonesia had only managed to realize a tiny fraction of its energy potential.

According to a document from the Energy Ministry, Indonesia is capable of producing up to 75,670 megawatts of electricity from hydroelectric sources. But current installed capacity is only 4,200 megawatts.

Other sources, such as geothermal, are estimated to have a production capacity of 28.53 gigawatts, but only 1,186 megawatts are currently produced.

Assuming no oil field expansions, and taking into account potential output from the Cepu oil and gas block in Java, the ministry calculates that Indonesia only has 7.99 billion barrels of oil deposits remaining, an amount expected to run out within 23 years.

As for natural gas, current deposits are estimated at around 159.64 trillion standard cubic feet, and are predicted to run out within 55 years.

Coal should be exhausted within 83 years, after current deposits of 20.98 billion tons have been used.

With the directorates of energy conservation, geothermal,
biofuels and miscellaneous renewable energy under his command, and around 100 staffers, Luluk is tasked with attracting private investors to sign on to long-term, risky renewable energy projects.

He’s also carrying the mission of President Susilo Bambang Yudhoyono,  who said in 2009 that Indonesia can reduce greenhouse emissions by 26 percent by 2020 on its own, or by 41 percent with the help of developed countries.

“There are some fiscal policies that need to be revised. For example, hybrid cars are taxed heavily in our country — that’s strange because in some developed countries those cars are subsidized.

Also, solar water heaters are considered luxury goods here. If we think in a green way, they must be given away for free,” Luluk said. He also emphasized the importance of a subsidy allowing independent power producers to sell energy at higher prices.

Current regulations mandate that state electricity provider Perusahaan Listrik Negara, must buy geothermal energy from independent producers whenever the price is at or below 9.7 cents per kilowatt hour.

Above that price, PLN is not required to buy, and is unlikely to.

“Regulations stipulate that PLN must buy if the price offered is at or below 9.7 cents per kWh. But I want the government to subsidize purchases above that price, so that investors don’t turn away from geothermal projects because they think they cannot sell output to PLN,” Luluk said.

Another goal of the new law, Luluk said, is to create industrial zones close to sources of renewable energy.

“Instead of building grids to connect factories to electricity from the power plant, why not bring the factories close to the sources of energy,” he said.

He pointed to Yogyakarta’s Mount Merabu, which has huge geothermal potential, as a good location for an industrial park. In May, the Finance Ministry announced incentives to boost investment in renewable energy.

The ministerial decree includes a 5 percent tax cut over six years for renewable energy producers as well as exemptions from value-added tax and import duties on equipment.

Another provision allows investors to use accelerated depreciation and amortization on assets to reduce taxable income.

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Freeport's Q2 liabilities reached IDR5.7 trillion
Aprilian Hermawan. Bisnis.com, Jakarta – 27/08/2010

The amount of liabilities of PT Freeport Indonesia (Freeport Indonesia) for the first quarter of 2010 reached US$634 million or around IDR5.7 trillion.

Freeport Indonesia spokesperson Ramdani Sirait explained the amount consisted of US$490 million in corporate income tax, US$106 million in employee income tax, regional tax, and other taxes, and US$38 million in royalties.

The total amount of payment Freeport had made as of June reached US$899 million or IDR8.1 trillion, consisting of US$581 million in corporate income tax, US$137 million in employee income tax, regional tax, and other taxes, US$105 million in royalties, and US$75 million in government dividend payment.
 
"The amount of quarterly payment is volatile in accord with commodity price, sales, and production," he informed in a press release yesterday.

Ramdani further explained the total liabilities based on the 1991 working contract that Freeport Indonesia had paid to the Indonesian government from 1992 to June 2010 reached US$10.4 billion consisting of US$6.3 billion in corporate income tax, US$2 billion in employee income tax, regional tax, and other taxes, US$1.1 billion in royalties, and US$1 billion in dividends.

In the meantime, PT Freeport Indonesia's 2008 Report on Works Toward Sustainable Development mentions there are indirect as well as direct economic benefits for the central government, the Province of Papua, and the Regency of Mimika.

The direct benefits cover tax, royalty, dividend, retribution, and other direct supports. Freeport is the largest private job provider in Papua and one of the largest national taxpayers. 
In 2008, Freeport contributed US$1.2 billion in direct benefit. Since the working contract began in 1992, the overall direct benefit for Indonesia has reached around US$8 billion.
 
On the other hand, indirect benefits for Indonesia cover infrastructure investments in Papua, such as investments in airport and port, road, bridge, waste disposal facility, and modern communication system.

Study by the Economic and Social Research Institute at the Faculty of Economics, University of Indonesia, Freeport Indonesia's contribution to the GDPs of Indonesia, the Province of Papua, and the Regency of Mimika reached 1.3%, 40% and 96% in 2008.

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Newmont to go ahead with IPO, denies Pukuafu claims
Alfian. The Jakarta Post, Jakarta – 27/08/2010

Newmont Mining Corporation says 10 percent ownership in PT Newmont Nusa Tenggara (NNT) would be divested through the bourse, negating claims that PT Pukuafu Indah was entitled to a preemptive right for the shares.

The US mining giant clarified that previous shareholders meetings had never granted Pukuafu, a local mining firm and a shareholder in NNT, with a preemptive right.

“Nothing has been done [by NNT shareholders] to grant [Pukuafu] a pre-emptive right,” Newmont vice president and deputy general counsel Blake Rhodes said Thursday.

Earlier this week, Pukuafu, which opposed NNT’s foray into the Indonesian stock market, stated it would exercise its preemptive right to acquire the 10 percent stake — preparing US$800 million for the acquisition.

Rhodes said the preemptive right could be available if all shareholders agreed to it, but no decision had been made on this matter. He added that even if shareholders agreed to a preemptive right, it had to be distributed to all shareholders based on ownership composition, meaning that the 10 percent shares would not fully go to Pukuafu.

Rhodes said Newmont preferred to launch an initial public offering instead of divesting the shares to existing shareholders.

“We hope shareholders will waive their rights so the new shares can go to the Indonesian public,” he said.

NNT is the operator of the Batu Hijau gold and copper mine in Sumbawa Island, West Nusa Tenggara. Newmont and Pukuafu have been in a dispute over the years on the composition of ownership in the company.

Newmont says that Newmont’s subsidiary Newmont Indonesia Ltd. owns a 31.5 percent stake, Sumitomo’s subsidiary Nusa Tenggara Mining Corporation 24.5 percent, Pukuafu 17.8 percent, PT Multi Daerah Bersaing 24 percent and PT Indonesia Masbaga Investama 2.2 percent. Multi Daerah Bersaing secured its 24 percent stake through a divestment process mandated by a 1986 mining contract.

The contract requires NNT’s foreign shareholders to divest up to 31 percent of their shares to local parties. The two companies are now in negotiations with the government for the divestment of the final 7 percent of shares scheduled for this year.

Pukuafu argues it was entitled to 51 percent shares in NNT, with Newmont Indonesia Ltd. holding 27.5 percent and Nusa Tenggara Mining Corp. holding 21.5 percent.

Pukuafu claims NNT’s foreign shareholders had previously agreed to transfer the 31 percent shares to Pukuafu in a shareholder meeting in 2005. The company also claimed it paid $258 million for the 7 percent share divestment in 2008.

Rhodes denied the claims, saying that the 2005 shareholder meeting never took place. He added that Newmont never received payment from Pukuafu.

“Under US regulations, Newmont would have been required to disclose the receipt of hundreds of million of dollars from Pukuafu,” he said.

Pukuafu has so far filed five legal suits against Newmont and NNT.

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3 subsidiary IPO in 2011
Irvin Avriano A. & Bambang P. Jatmiko. Bisnis.com, Jakarta – 27/08/2010

The largest steel producer PT Krakatau Steel prepares IPO of three subsidiary firms by 2011.

President director of Krakatau Fazwar Bujang said the IPO of three Krakatau subsidiary firms is scheduled in 2011. currently the company focuses more on Krakatau IPO by November 10, 2010.

"We cannot mention the would-be privatized subsidiary firms. They are surely of the companies under Krakatau. Some will be divested to market next year," he said in Jakarta yesterday.
Krakatau selected 10 companies of many sectors ranging from technical contractor up to port and health service. On of the 10 firms here has been listed at the bourse, PT Pelat Timah Nu­san­tara Tbk.

The other nine subsidiary firms include PT KHI Pipe Industry, PT Krakatau Wajatama, PT Krakatau Daya Listrik, PT Krakatau Engineering, PT Krakatau Information Technology, PT Krakatau Tirta Industri, PT Krakatau Industrial Estate Cilegon, PT Krakatau Bandar Samudra, and PT Krakatau Medika.

Relating to IPO Krakatau, Fazwar said the company will sell 19.26 percent shares to public targeting to tap IDR3-4 trillion proceeds which will be allotted for expansion and production capacity rise in particular.

For the remaining stocks 10.47 percent, he said so far there is no final decision yet on whether or not the remaining shares will be divested through secondary offering or strategic sales.
The government and legislatives have approved the privatization of 30 percent Krakatau shares. The company then decided to divest the IPO stock of 19.26 percent so there is still 10.74 percent shares remaining.

Fazwar said the joint venture company of Krakatau and Posco, South Korea, has been effective since the signed cooperation involving both firms yesterday. The new name will be PT Krakatau Posco.

The company now has 30 percent shares at the joint venture which readies to build a factory in Cilegon. Some 70 percent is owned by Posco. Krakatau has option to rise stocks possession at Krakatau Posco up to 45 percent on the factory operational.
He said with the submission of preliminary contract document prior to IPO, the company will enter the black out period so as not to provide any confirmation.

The document goes to Bisnis showed that in semester I/2010 Krakatu tapped IDR9 trillion revenues or grew 14.98 percent as from DIR7.82 trillion last year with IDR997.75 billion net profits or 190.55 percent of the IDR1 trillion net losses in semester I/2009. however, Fazwar did not comment on the data.
He is surely optimisti the demand for steel at global market will increase next year by 8-10  percent. "the better economy situation will increase the consumption and steel price," he said.

Separately, IDX corporate assessment director Eddy Sugito said Krakatau has submitted preliminary contract document of the stock listing. "The issuance value is some trillions but I cannot make it sure," he said.

Eddy added in addition to Krakatau, preliminary document of PT Agung Podomoro had either been submitted. Agung Podomoro plans to offer 30 percent of shares and targeted to tap DIR2-3 trillion.

The company previously was said to have appointed PT Deutsche Bank Se­curities, PT Mandiri Sekuritas and PT Indopremier Securities as the underwriter.

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Antam waits green light for Inalum acquisition
Bambang P. Jatmiko & Rudi Ariffianto. Bisnis.com, Jakarta – 26/08/2010

The State Ministry for State-owned Enterprises (SOEs) targets the plan of PT Aneka Tambang Tbk (Antam) to acquire 100% shares in PT Indonesia Aluminium (Inalum) will find the light at the end of the tunnel after Idul Fitri.

State Minister for SOEs Mustafa Abubakar said there had not been any progress regarding Antam's plan to take over shares in Inalum.

"I have not updated information regarding the purchase of Inalum [by Antam]. The Coordinating Minister for Economic Affairs has not held another meeting. I hope there will be progress after Idul Fitri," he said today.

He continued three financial institutions had been ready to help Antam acquire Inalum. The three companies were PT Danareksa (Persero), PT Bahana Securities, and the Asset Management Company (PPA).

Record by Bisnis showed the three companies had a capacity to seek the IDR800 million funds needed to acquire Inalum.

In the meantime, Deputy State Minister for SOEs for Banking and Financial Services Parikesit Suprapto revealed if Antam directly acquired Inalum, it should ask for approval first from the shareholder.

Currently, the government controls a 41.12% stake in Inalum and the consortium of Japanese companies, Nippon Asahan Aluminium (NAA), seizes the rest.

Deputy State Minister for SOEs for Mining, Strategic Industries, Energy, and Telecommunication Sahala Lumban Gaol said the State Ministry would meet with the Japanese shareholders in October to discuss the wish of SOE to acquire Inalum.

"However, we will also open a possibility for Japanese companies to work together with the SOE." In the meantime, Director of Metal Industry at the Ministry of Industry I Gusti Putu Suryawirawan disclosed the government would choose an investor that could create the greatest benefit.

"The investor in Inalum should be able to revitalize the national aluminum industry. Indonesia has a huge chance to become a global player since we have the upstream industry, especially the bauxite industry," said Putu, who is also a member of the Inalum review team overseeing the technology aspect.

He said the government had not yet started negotiation with Japan, so it could not be decided whether Indonesia would still work together with Japan under a fairer contract or Indonesia would take over 100% shares in Inalum.

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Government to overcome oil-gas problems in one month`s time
ANTARA News, Jakarta – 26/08/2010

The government is committed to settling various problems in the oil and gas sector in a month to step up its oil production target to 1 million barrels per day in 2013, a spokesman said.

"A problem that has to be solved immediately is the draft government regulation on `cost recovery`," Coordinating Minister for Economic Affairs Hatta Rajasa said here on Thursday.

The minister made the statement after attending a meeting, chaired by Vice President Boediono to discuss oil and gas related issues.

Present at the meeting were among others Transportation Minister Freddy Numberi, Energy and Mineral Resources Minister Darwin Saleh, and state oil company PT Pertamina president director Karen Agustiawan.

Hatta Rajasa said the government was committed to endorsing the draft of government regulation in a month.

Besides, he said the government would also try to solve oil production problem at potential oil wells and the wells included in marginal category.

The problem hampering oil production at Cepu Block will also be solved immediately.
Hatta said for the issue of land clearing at Cepu Block, the National Board of Land Affairs (BPN) would be given a dead line to complete the 20 percent residual residual of land clearance.

He added that another problem that has to be solved at Cepu oil Block was about the addition of pipe to increase oil production capacity.

Hatta said that in one month the government would decide whether to remain using the existing pipes of Pertamina with a compensation, or to install new pipes.

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Exxon told to clean up mercury at its old site
Adianto P. Simamora. The Jakarta Post, Jakarta – 26/08/2010

The Environment Ministry is officially ordering liquid natural gas producer ExxonMobil clean up mercury found in soil at the company’s former warehouse facility in Hueng village, North Aceh.

The order was made during a closed-door meeting with representatives from ExxonMobil Indonesia at the ministry’s office Thursday.

“We told [ExxonMobil] about our mercury-pollution finding. We also ordered it to clean the soil from mercury,” said Rasio Righo Sani, assistant deputy for management of hazardous waste from mining activities, who chaired the meeting.

He said that representatives from ExxonMobil, however, declined to sign the minutes of the meeting.

“But in principle, they expressed their readiness to help the local administration clean the area from mercury,” he said.

ExxonMobil has said that mercury in the soil of the company’s former workshop and warehouse facility did not come from the company.

“ExxonMobil is ready to cooperate with the local administration and related parties, including the Environment Ministry, to handle the [mercury] problems,” public affairs vice president of ExxonMobil Indonesia told The Jakarta Post.

US-based ExxonMobil handed over the land to the North Aceh administration last year.

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Transportation

Sriwijaya wants to get 1,260 seats of Australian routes
Kontan.com, Jakarta – 27/08/2010

PT Sriwijaya Air ingin dapat jatah 1.260 kursi untuk rute baru yang ingin dibukanya ke Australia. Menurut Corporate Communication Manager Sriwijaya Ruth Hanna Simatupang, maskapainya sudah menyatakan minat untuk membuka rute Jakarta-Perth sejak tahun lalu.

"Kami ingin melayani rute tersebut satu hari sekali menggunakan Boeing 737-800 NG berkapasitas maksimal 180 kursi. Permintaan itu sudah kami ajukan ke Kementerian Perhubungan (Kemhub)," kata Hanna, Jumat (27/8). Ia berharap pemerintah bisa memberikan kepastian pemberian jatah kursi dari Ditjen Perhubungan Udara Kemhub di penghujung tahun ini; sehingga rute barunya itu bisa segera dilayani tahun depan. 

"Untuk rute baru itu kami masih melakukan persiapan, terutama sambil menunggu pesawat Boeing 737-800 NG pesanan kami datang tahun depan," imbuhnya. Seperti diketahui, Pemerintah Indonesia dan Australia menyepakati 4.000 kursi tambahan per minggu yang bisa dimanfaatkan maskapai penerbangan masing-masing negara.

Selain Sriwijaya, yang sudah jelas menyatakan jumlah kursi yang diinginkannya adalah PT Garuda Indonesia (Persero) sebanyak 1.110 kursi. Maskapai yang dipimpin Emirsyah Satar itu ingin menambah 666 kursi untuk rute Jakarta-Sidney dari frekuensi empat kali penerbangan seminggu menjadi setiap hari serta 444 kursi untuk Jakarta-Melbourne dari tiga kali seminggu menjadi lima kali seminggu. 

Untuk catatan, Garuda sudah melayani dua rute itu menggunakan Airbus A330-200 berkapasitas 222 kursi.

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Information and Communication Technology

Indosat Studying Merger, Consolidation To Secure Growth - CEO
Dow Jones, Jakarta – 26/05/2010

PT Indosat Tbk (ISAT.JK), Indonesia's second-largest telecommunications company by subscribers and assets, is assessing whether some form of merger or partnership could be an effective way for the company to secure growth in an overcrowded and highly competitive market, company officials said Thursday.

"We're studying options for merger or consolidation," Chief Executive Harry Sasongko said.

Chief Financial Officer Peter Kuncewicz added that the firm is looking at all available options.

"These sort of studies will take time. It can be both ways: we can acquire or be acquired," Kuncewicz said.

With 11 telecoms operators all competing for new business, further growth opportunities are limited and the industry's consolidation is inevitable, analysts say.

Telkom (TLKM.JK), the largest telco operator, said in June it is "seriously considering" Bakrie Telecom (BTEL.JK) as a potential partner for its code division multiple access-based cellular division.

Major telco firms such as Telkom and XL Axiata (EXCL.JK) have started to shift its focus to data and content services as the next growth driver.

Indosat is 55%-owned by Qatar Telecom (Qtel Asia) Pte. Ltd, with 14.29% held by the Indonesian government, 15.62% by Bank of New York Mellon and 14.3% by the public.

It had 37.8 million subscribers at the end of the first half of this year, and is likely to have over 41 million subscribers by the end of year.

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