Friday, February 23, 2024

Adaro Minerals allocates US$ 2 billion for alumunium smelter construction

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PT Adaro Minerals Indonesia Tbk (ADMR) is allocating a capital expenditure (Capex) of US$ 2 billion for the construction of an aluminum smelter, currently in its first phase. 

Wito Krisnahadi, Director of Adaro Minerals Indonesia, stated that the management is currently using 70% equity funding. 

Additionally, Wito explained that the capacity of the first-phase aluminum smelter is 500,000 tons per year. He also mentioned that the capacity will increase to 1.5 million tons in three phases.

“So, there will be three phases, the first reaching 500,000 tons per year, which is planned to be completed for all commercial operation dates by the end of 2025. Then, for the second phase, also the same 500,000 tons, and then the third phase 500,000 tons per year, making a total of 1.5 million tons per year,” said Wito on November 27, 2023.

Currently, Adaro Minerals Indonesia has around 65% indirect ownership in PT Kalimantan Aluminium Industry (KAI). 

Therefore, the company is entitled to a share of the profits generated by KAI without the need to supply coal to the smelter. 

Wito stated that Adaro Minerals’ focus is currently on metallurgical coal mining, not thermal coal. Therefore, for the time being, ADMR does not plan to supply thermal coal to the smelter project at Kalimantan Aluminium Industry.

“For now, ADMR has no plans to supply thermal coal to the smelter project at KAI,” said Wito.

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