Monday, December 15, 2008

South Korea company will build up the steel factory in Cilegon

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One of the South Korea steel producer company - Pohang Steel Corp. (Posco) - is probing to build up a steel factory in Cilegon, Banten, with worth around US$ 5 billion. This factory will produce around 2.6 million to 3.1 million tons of steel.

Posco is lobbying P.T Krakatau Steel (KS) about the infrastructure and expect Kratakau Steel allow them to use the Cilegon infrastructure such as sea-ports facility and other facilities based on mutually beneficial cooperation. Although, both of the two companies is a state-owned enterprises (BUMN) in each country.

"I have not receivied a letter from Posco yet. But, from the information that I have got, Posco is doing serious discussion with Krakatau Steel," said Head of Investment Coordinating Board (BKPM) M Lutfi, on Tuesday (16/12/2008).

The potential market of steel which is not only in domestic but also in a global market, is the reason why Posco interested in investing on steel business. In addition, the regulation of domestic steel sector, allow for both local and foreign investors to invest in this sector.