CILEGON. Krakatau Industrial Estate Cilegon (KIEC), a subsidiary of Jakarta-listed steel giant Krakatau Steel (KRAS), will sell an industrial site to a unit of South Korean conglomerate Lotte, which will use the land for a chemical plant.

KIEC will sell 50 hectares of land for the chemical plant, according to KRAS’ senior vice president, Erwanto.

He said that the parties had yet to agree on the price. However, he said KRAS would offload the property for somewhere between Rp 750 billion (US$66 million) and Rp 1 trillion.

“There are many buyers who want to purchase KIEC’s land. However, we are committed to supporting the government and will sell it to Lotte,” Erwanto said on the sidelines of a meeting with Lotte in Seoul.

Erwanto said that KIEC currently held 700 hectares of land, of which 80 percent had been sold. Lotte is planning to purchase some of the remaining 20 percent, which is located adjacent to its proposed plant.

Lotte is investing up to $5 billion in the chemical plant project.

Investment Coordinating Board (BKPM) deputy chairman of investment monitoring and implementation Azhar Lubis said talks would continue to determine the price of the site.

“Lotte wants land that is clean and clear,” he said, referring to the usual complexities of land acquisition in Indonesia.

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Editor: Asnil Amri