Investment company PT Bhakti Investama will spend as much as US $2 billion by 2015 to expand into the oil, gas and mining businesses as demand grows domestically and in China, its president director said on Friday.
The company has acquired a South Sumatran coal miner in May after buying a majority stake in an offshore Papua oil and gas block earlier in April 2010, said Harry Tanoesoedibjo. He declined to provide further details.
“It's very big opportunity for investment because Indonesia is still underdeveloped,” Harry, who is also Bhakti’s chairman, said in Jakarta. “The key challenge is to be able to identify the right target. Indonesia is very strong in the resources.”
Bhakti is expanding into the commodities sector as China demand drives prices higher. China is the world’s biggest user and producer of coal and its demand for coal used to make steel is forecast to rise 5.6 percent to 38 million metric tons this year, according to a Macquarie Group forecast.
Harry had earlier said Bhakti had recently turned its attention to the energy sector. The company, which gets most of its earnings from its media business, aims to grow its mining business to a third of its profit in three years, he said.
The company derives about 91 percent of its revenue from its content and advertising-based media company, PT Media Nusantara Citra, and its integrated media company, PT Global Mediacom.
Bhakti will fund the acquisitions through new share sales, a bond issue and asset sales which will raise at least $500 million this year, he added.
Budiono, of Bhakti’s oil, gas and mining division, had earlier said Bhakti hopes to buy two to four oil and gas blocks in South Sumatra and Papua this year.
He said Bhakti had also planned to acquire two coal mines with combined minimum reserves of 100 million tons, worth $150 million, in Sulawesi and Kalimantan this year.
In the longer term, the company also aims to develop gold and nickel mines and coal-bed methane and geothermal energy projects, Harry said.(*)
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