P.T. Inco completes expansion financing

P.T. Inco now has the money to proceed with the planned expansion of its Indonesian operation.

The firm, an Indonesian-based company owned 58.7% by Inco (TSE), has received from international financial backers $421.25 million to finance the expansion, including $81.25 million to refinance its existing debt.

The cash infusion will enable the company to begin the US$580-million expansion of its Soroako nickel mine and smelter operations on the Indonesian island of Sulawesi. When the expansion is complete in late 1998, annual production of nickel matte is expected to jump 50 million lb. to 150 million lb.

In an attempt to increase annual capacity by 15 million lb., the expansion calls for upgrades to three existing production lines at the smelter. A fourth smelting line, capable of producing 35 million lb. of nickel matte per year, will also be built.

P.T. Inco will also increase its electric generating capacity by constructing a US$130-million hydroelectric plant on the Larona River, near its existing plant.

The lenders will provide up to $340 million for the expansion over a 3-1/2-year period. P.T. Inco will finance the remainder of the expansion with existing cash balances and internally generated funds.