Govt to solve energy crisis facing Kertas Leces

The government insists on maintaining the ailing state paper producer PT Kertas Leces, saying the energy shortage problem plaguing the company will be resolved with construction of a new coal boiler plant later this year.

The new coal boiler plant, consisting of five power boilers, two chemical recovery boilers and three steam turbins, will help the company save US$ 94 per ton of paper.

“The convertion of gas into coal will resolve one of Kertas Leces problems.The new boiler plant will allow the company to resume its business,” secretary to the minister of state enterprises Said Didu told reporters on Thursday.

He declined to disclose the total investment for the plant .

Kertas Leces, located in Surabaya, produces 600 tons of paper daily. Currently it operates only 30 percent of its total capacity due to shortage of gas and raw material.

The Ministry of State Enterprises data reveals that Kertas Leces has suffered losses from 2006 even though its sales has remained good. In 2008, its sales reached Rp 792.84 billion, but booked Rp 49.4 billion in losses.