Indonesia Asahan Aluminium (INALUM) has put down long-term intent of tripling its production volume by stretching out operations to the Island of Borneo, as it solicits to resort the region’s profuse bauxite reserves.
According to Managing Director, Oggy Achmad Kosasih “The state-owned company known as Inalum plans to boost capacity to 750,000 tons by building a 500,000-ton smelter in North Kalimantan, on the Indonesian side of Borneo, as power supply constraints limit the expansion of its sole facility in Kuala Tanjung, North Sumatra”.
He did not communicate any timelines for this upscale.
The Managing Director added “The existing smelter relies on electricity from a hydro plant that can only provide enough power for 250,000 tons of aluminum a year, Kosasih said in an interview on Monday in Kuala Tanjung. The company is trying to increase output to 300,000 tons by upgrading its furnace.”
Inalum’s expansion has multiple holdings in Indonesia’s top miners which include a 51% stake in PT Freeport Indonesia, it’s the organization that runs the huge Grasberg copper and gold mine. This is in the alignment of President Joko Widodo’s vision of transforming the country from an exporter of minerals into a major producer of processed metals. The movement will also aid in cutting down the raw materials costs as Kalimantan is Indonesia’s leading bauxite producing region.
Later Kosasih said: “Increasing production capacity won’t mean anything if we don’t cut costs from the production side and the source of raw materials.”