Jakarta, November 17, 2011 – PT International Nickel Indonesia Tbk (“PTI” or the “Company”; IDX: INCO) today informs an event that occurred on November 2 at its Sorowako operations.
During a scheduled shutdown of Furnace #2 for a rebuild, high temperature molten metal from the furnace came into contact with water, resulting in a series of low intensity steam explosions. Emergency response procedures were put into action immediately and the situation was quickly stabilized. There were no injuries. An initial assessment revealed damage to control systems associated with Furnace #1 and other associated peripheral equipment. As a result, Furnace #1 remained shut down following the event while the Company proceeded with the assessment. Furnaces #3 and #4 continue to operate normally.
Based on the latest assessment it is estimated that Furnace #1 will be back in normal operation in February 2012. The estimated impact on production is approximately 4,600 metric tons, with the loss of 3,300 metric tons in 2011 and 1,300 metric tons in 2012. Based on the Company’s preliminary estimate, total repair costs will be
approximately US$5 million.During a scheduled shutdown of Furnace #2 for a rebuild, high temperature molten metal from the furnace came into contact with water, resulting in a series of low intensity steam explosions. Emergency response procedures were put into action immediately and the situation was quickly stabilized. There were no injuries. An initial assessment revealed damage to control systems associated with Furnace #1 and other associated peripheral equipment. As a result, Furnace #1 remained shut down following the event while the Company proceeded with the assessment. Furnaces #3 and #4 continue to operate normally.
Based on the latest assessment it is estimated that Furnace #1 will be back in normal operation in February 2012. The estimated impact on production is approximately 4,600 metric tons, with the loss of 3,300 metric tons in 2011 and 1,300 metric tons in 2012. Based on the Company’s preliminary estimate, total repair costs will be
The Company will utilize the situation to move forward scheduled maintenance work
on Furnace #1 initially scheduled for late 2012. By doing so, the Company expects
that when the furnace is back in operation it will continue uninterrupted during 2012.
All of the necessary procedures are in place to start the insurance claim process for
property damages and business interruption losses.