U.S. firm to invest $4 bln in Indonesian pulp factory

JAKARTA, March 24 (Xinhua) -- U.S.-based paper and pulp company International Paper plans to invest more than 4 billion U.S. dollars in a pulp factory and industrial forest in Indonesia, local press said Monday.

The pulp factory will have the capacity to produce 1.5 million tons of pulp per year, supported by a 500,000-hectare plantation forest, reported major newspaper The Jakarta Post.

Central Kalimantan and Papua provinces had been chosen as the investment locations despite a lack of supporting infrastructure because no similar businesses operated there, the newspaper said, quoting a senior official with the Forestry Ministry.

International Paper is currently rated among the three largest pulp and paper producers in the world. They operate two factories in Brazil and Canada.

The company chose Indonesia for its business expansion after conducting a six-month feasibility survey in a number of Asian countries, said Hadi S. Pasaribu, director general for forest product management.

Hadi said he had requested International Paper follow Indonesian investment regulations by establishing a local company here.

Indonesia has 84 integrated pulp and paper mills, with a total production capacity of 6.5 million tons.