aspal buton project 2013

BUTON ASPHALT EXTRACTION PROJECT

[Superpave Mix Design]

Highest ROI I Green Technology I The First In The World

Presentation By Ignatius A. Wirawan Agung Kristianto

Foreword In order to support the Government of Indonesia in:

Developing infrastructure facilities, Saving the Foreign Exchange Reserves, Opening job opportunities and modernizing local communities, Increasing local Governments income, Reducing urbanization and developing technology by a concept of one village one movement product based on natural resource basis,

herewith we would like to introduce THE BUTON ASPHALT EXTRACTION PROJECT

This project is to produce a bitumen product called modifier from a purification process of naturally occurring asphalt of Buton using full-extraction technique an Eco Friendly Technology found by Ir. Sayono that has a Patent Certificate and get recognition from world institution such as International Federation of Investors Association (IFA), Texas A&M University, the Asphalt Institute.

This is a pioneering project, however, it is very unique, because it might be the only one in the world and the result of the project will make the investor a world class company.

Investment Presentation

Asphalt World Petroleum Asphalt, Natural Asphalt, Modifier Asphalt

Investment Presentation 3

About Asphalt Asphalt is a dark brown to black cementitious material in which the predominating constituents are bitumens that occur in nature or are obtained in petroleum processing. [ASTM, American Society for Testing and Materials]

Petroleum Asphalt: Modern asphalt is a natural constituent of petroleum. Practically all asphalt used in the world nowadays is produced by modern oil refineries and is called petroleum asphalt. In civil engineering and construction it is also called AC or asphalt cement.

Naturally Occurring Asphalt: These asphalts occurred naturally. The soft asphalt material is typified in the Trinidad Lake depository called Trinidad Lake Asphalt (TLA), on the Island of Trinidad, in Bermudez Lake in Venezuela.

The solid rock formation (asphaltite) can be found in Uintah Basin in eastern part of the State of Utah, North America called American Gilsonite Company (AGC).

Buton Asphalt in the Buton Island, south coast of Sulawesi. One of the largest natural asphalt deposit in the world.


Conventional to Superpave Ninety-eight percent of the worlds asphalt is a product of petroleum refining. Modification techniques are used to meet highway needs.

The asphalt industry is responding to the increase in traffic and heavier loads on highways, which have resulted in unwelcome pavement distresses and calls for smoother and longer lasting roads.

In 1987, the Federal Highway Administration (FHWA), the highway industry and the American Association of State Highway and Transportation Officials (AASHTO) in USA, working through the National Academy of Science, initiated the Strategic Highway Research Program (SHRP). From this program came the development of the Superpave (Superior Performing Asphalt Pavement) mix design system where modified asphalt plays a significant role.

The Superpave system addresses the performance properties of both asphalt binders and mineral aggregates. In addition, asphalt binders are characterized by their engineering properties so their performance can be predicted for the specific climate and loading conditions where they are applied. The binders can be improved with modifiers, when warranted, to offer an even greater level of performancemaking roads last longer while maintaining smooth riding surfaces.


Modifier Asphalt

Modified asphalt simply performs better than conventional asphalt cement.

Natural Modifier: natural asphalt is a perfect modifier for producing Superpave. Trinidad Lake Asphalt (TLA) and Gilsonite Asphalt (AGC) are the examples of natural modifier produced commercially and accepted by international market as modifier for petroleum asphalt.

Synthetic Modifier: A wide variety of synthetic modifiers, which target specific performance deficiencies of commodity asphalt, have been developed. However, the success of synthetic modifiers has been inconsistent and the opinions of engineers have been mixed. While synthetic modifier can offer superior performance in many facets, a modifier that makes an asphalt pavement more resilient to extreme heat or deformation may not allow for greater strength or resistance to low temperature.


or

Buton Asphalt as Modifier Buton natural asphalt mine deposit is one of the largest in the world which is estimated around 700 million tons.

However, not as lucky as TLA and AGC, Buton natural asphalt has not yet been categorized as international standard modifier because of its inherent weaknesses.

Full-extraction process is the only solution to repair any weakness inherited in Asbuton these days. A pilot test run toward this process has been successfully tested by inventor named Sayono. By this process, all Asbuton weaknesses are certainly able to be repaired today. Furthermore, this process also gives possibility for Asbuton to be specified as an international standard natural modifier product competing others.

Bitumen produced by full-extraction process from Asbuton is ready to match its physical properties referred to as TLA and AGC. This approach is also chosen as a marketing strategy consideration. Market is expected to absorb the presence of Asbuton modifier because its specification is recognizable and consistent among other well-known international natural modifiers.

It just need 20% addition of Asbuton modifier to petroleum asphalts to match with Superpave Performance standard.


A Dutch geological expert, Hetzel, in 1936 has discovered that the occurrence of Asbuton deposits in Buton Island spans about 70 km from north to south.

According to a report released by the office of energy and mineral resources in Province of Southeast Sulawesi, the estimated Asbuton deposit is very enormous with asphalt (bitumen) content that varies from 10 to 50%.

The deposit locations expand from Lawele bay in the north to Sampolawa bay in the south for about 70 km long and 10 to 15 km wide, plus Enreko area in the Regency of North Buton (previously was the Regency of Muna).


South Buton Asphalt Deposit

No Location Asphalt Content (%) Deposit (Million Ton) 1 Kabungka 10 - 20 60

2 Winto 10 - 20 3.2

3 Winil 10 - 20 0.6

4 Siantopina 10 - 20 181.25

5 Olala 10 - 20 47.049

6 Enreko 10 - 20 174.725

7 Lawele 20 - 40 210

Source : Report on Asbuton Geo-Electric Sounding & Core Drilling In Lawele Village, South Sulawesi, 1997.

Boring-Log Data Example


Source: Alberta Research Council, Canada, 1989. (TOR untuk Penetrasi pada 25 C ditentukan = 2)

The Invention Technology, Patent, Award, Recognition


Ir. Sayono Technology This project is prepared by using a technology that has been developed since the early 1990s by Sayono, beginning with a number of researches, followed by inventions and a certified patent on Buton natural asphalt purification process.

Such process has undergone several stages of pilot run scale testing procedures in Texas A&M University, one of the well-known research institutions in the United States.

By these achievements, quality of Buton asphalt is now possible to be repaired make it uniquely to compete with any existing similar qualified products. The product resulted from this project is an international standard pure bitumen required by infrastructure world, especially by construction agencies which are involved in asphalt mixture road pavement.

Therefore we would like to implement such achievements become a commercial-scale production process.


Extraction Process


Pilot Run at Texas A&M University


The Test Result


Modified Asphalt

(PG Standard)

Petroleum-base

AsphaltModifier

Polymer SBS (styrene-butadiene-styrene)

Synthetic

Shell

Chemical(Elastomer)

BASF

ChemicalDu-Pont

Good Year(Ultracote)

Naturally Occurring Asphalt

Trinidad Lake

Asphalt

(TLA)

American

Gilsonite Co.

(AGC)Asbuton

Need to be specified for it

to be accepted by the

global market.

Mix Design SUPERPAVE


Source: www.asphaltinstitute.org

Pertamina Asphalt Without modifier =

PG 46-10

Shell = PG 52-16

Pertamina Asphalt with Modifier Asphalt

Button = PG 64-16

Patent

Property by the Patent Certificate No. ID 0 004 877: Extraction Process for Refining the Buton Islands Asphalt Using Organic Solvents. From the point of legal aspect, the process of Buton Asphalt Extraction is protected legally from an attempt of duplication or plagiarism by others.

Six years were needed for the Patent Certificate to be issued as verification process on other comparing documents (if any) was exercised by the World Intellectual Property Organization (WIPO) in Geneva, Switzerland, through a program called Patent Cooperation Treaty (PCT).

The invention was registered in the International Federation of Inventors Associations (IFA) in Geneva, Switzerland, with reg no 191C in 2003. Indonesia is still represented by only one inventor.

This product has also already passed a number of international standard certifications released by the Asphalt Institute, a reputable asphalt standard-setting institution in United States.


Patent Document


World Intellectual Property Organization


Recognition

Pilot Test Run in Texas A&M University on November 7-14, 1997.

A number of Performance Graded (PG) certifications for the product by the Asphalt Institute in 1998-2000.

Engineering, Procurement and Construction (EPC) Design Report by China Machinery & Equipment Co., Beijing, China, on May 20, 2005.

Complete Test Result on quality of Asbuton-modified Aphalt by R&D Centre for Roads and Bridges, the Ministry of Public Works, on March 4, 2008, and

Asbuton Modifier Technical Specification by Laboratory of Petroleum Technology, Department of Chemical Engineering, UGM, on April 14, 2008.


Prelimenary Investment Presentation

Mr. Sayono

Recognition by Asphalt Institute

Product Certification


Result that Asphalt Buton is Qualified

as the Modifier for Superpave

(Superior Performing Asphalt Pavement)

Accredited in USA through The Asphalt Institute, Lexington, Kentucky, USA.


Product Extensions:

The By Products: Roofing Materials Body Coating Pipe Coating Sealant

Technology Value

Business Projection Market Demand, Estimate Price, Potential Revenue


Potential Revenue

From the perspective of material substance, this product is unique as there are only two kind of similar products in the world which comply with international specification, i.e. Trinidad Lake Asphalt (TLA) and America Gilsonite Company (AGC).

Product margin generated by this project is relatively high caused by the involvement of invention technology. Once the projects risk are anticipated carefully, high-profit margins are typical for such invention-based projects.

The end product is price at USD 1000/tons, this is lower than the competition price of USD 1500 2000/ton and also lower than SHELL/ BP/ EXXON products, which is USD 2000 4000/ton. Adjustment of selling price will have a positive impact to the profitability of the profit.

[Note: Price for Modifier Asbuton when price for crude oil US$ 60/Barrels is around USD 1000 to USD 1500 with competitor price is around USD 1500/Ton (AGC Modifier) and USD 1250/Ton (TLA Modifier).]


Local Market Needs


According to Directorate General of Highway, the Ministry of Public Works, domestic asphalt consumption in year 2012 is around 1,5 million tons and grows 5% per year. Meanwhile, Pertamina can only provide asphalt below half a million ton/year. The shortage is unfortunately compensated by importing.

International Market Needs


According to a New Report by Global Industry Analysts (GIA); the global market for Asphalt is forecast to reach 118.4 million metric tons by the year 2015. Prediction estimate, 20% of the global market(118.4 Million Metric Tons), needs to have a SUPERPAVE Asphalt Modifier, to have a cost saving & build better road.

US & Canada Market AC or Asphalt Cement is a solid or semisolid asphalt that has not been modified by the addition. Modified AC is defined as an asphalt cement to which a performance- improving additive has been combined.

Asbuton specified such as TLA or AGC is potential to fill in the global market for modifier.

It is shown in Table 5.5 that AC consumption in the US is around 25 million tons whereas Modified AC consumption is 2.5 million tons. Meanwhile Table 5.6 shows that AC and Modified AC consumptions in Canada are respectively around 2.7 million and 190 thousand tons.

Using conservative assumption that proportion of modifier ranges from 10 to 15% of its total consumption (both AC and Modified AC), therefore, market potentials for asphalt modifier in the United States and Canada can be calculated.


European Market In Europe EAPA or European Asphalt Pavement Association released a report saying that asphalt consumption in EU country members in 2008 is listed in Table 5.7.

Total Bitumen (EAPA uses this term instead of AC) consumption in Europe plus Australia, Japan, New Zealand, Mexico and Venezuela in 2008 is around 26.27 million tonnes whereas total Modified Bitumen (EAPAs term for Modified AC) consumption, after multiplying with each percentage respectively, is 3 million tonnes.

One tonne equals to 1 metric ton or 1,000 kg. Hence, using as same conservative assumption as in the United States and in Canada, market potentials for asphalt modifier in Europe and some countries in Asia Pacific and Central America can be calculated.


Letter of Intent

Product purchase warranty from both domestic and foreign:

The Ministry of Public Works of the Republic of Indonesia;

Letter of Intent from PT. Sapta Tunggal Perkasa (TLA and AGC supplier based in Denpasar, Bali)

Letter of Intent from C&G Law (a legal association representing asphalt producersin Adelaide, Australia)

Letter of Intent from Bellsouth Co. Ltd (a company running in modified asphalt business from Owensboro, Kentucky, USA)

Letter of Intent from the Asphalt Associates Ltd (TLA and AGC supplier based in Survey, United Kingdom)

Off Take agreement from Antech Co. Ltd (a trading company in Daejeon, South Kore)


Letter of Intent Document



Letter of Intent Document

Bellsouth Co. Ltd, Owensboro, KY USA

Off take Agreement


Competition No local competitor. There are numerous asphalt mining projects in the island, but none will ever have the qualities and profitability of this project.

Head to head against high-capital multinational industries such as Shell Elastomer (one of the biggest synthetic modifier producers), TLA, AGC, Alberta Canada (tar sand refinery in Canada), etc.

Presently to make the asphalt, synthetic products, which are petroleum based are manufactured by oil companies (SHELL, EXXON, etc).

However, these products are expensive, extremely dependent in oil price which require highest maintenance.


Business Notes This project is indeed a new technology. However, since a pilot test run has been successful, hence engineering and financial aspects for the projects equipment procurement are identified and calculated.

Condition of asphalt mine in Buton Island which is still not equipped with sufficient infrastructures, such as lack of road access from mine location to sea harbor, electrical and clean water supply, etc.

Invention-based project potentially disturb and destabilize the continuation of similar existing products.

Immature preparation and management could result in failure of the projects production and operational failure.

The most possible risk which often occurs is driven by these two following major causes:

Lack of after-sales service (which causes distrust on buyers side when, for instance), product delivery is not in time.

Unhealthy competition made by similar producers, if any.


Plant Note of the Project


Extraction Schematic


CHILLER

< 0 oC

LIGHT VACCUM

PUMP > 100 MM Hg CONDENSER

40 oC

WORKING

TANK

DECANTER

HYDRO

CYCLONE

CENTRYFUGE

EXTRACTOR

25 - 90 oC

Evap

ora

tor

1

Evap

ora

tor

2

HF

O T

AN

K

DE

CA

NT

ER

280 oC250 oC

STEAM

300 oC

CONDENSER

CRUSHER

2.5 MM

DRYING

BIN

3 HARI

DRYING

BIN

3 HARI

CONVEYOR

STEEL CONVEYOR

DESOLVENTIZER

CONVEYOR WASTE KE LAUTTURBINE

GENERATOR > 2 MW

BOILER

WATER

TREATMENT

KOLAM AIR

UNTUK PROSES

DAN PENDINGINAN

PELLETIZATION

BAGGING UNIT

SCHEMATIC

DIAGRAM

KE BOILER

DARI KOLAM

DARI KOLAM

DARI TANKI

SUPLESI SOLVENT

FLUDIZED

BED

BOILER

CL

EA

N B

ITU

ME

N

HOT MODIFIER

HO

T M

OD

IFIE

R

Air

6%

s/d

16%

dari

RO

M

CONDENSER

40 oC

DARI KOLAM

POMPA

AIR

KE KOLAM

250 oC

Max. 3.0

00.0

00 K

cal/ja

m

12.0

00.0

00

Kcal/ja

m

400.0

00 K

cal/ja

m

Larutan

Bitumen Kotor

Larutan

Bitumen Bersih

SO

LID

-LIQ

UID

Ho

t V

ap

or

Ho

t V

ap

or

plu

s s

team

Ho

t V

ap

or

plu

s ste

am

SPRAY

COOLING WATER

RAW OF

MATERIAL

KE

KO

LA

M

So

lven

t

Vap

or

So

lven

t

Vap

or

Solvent

Solvent

So

lven

t

Engine Design Full Extraction


Machine & Equipment


No. Mesin dan Peralatan Jumlah Tailor Made Vendor Catatan

1 Conveyor 1 Transport dari Mining Pit

2 Hammer Mill 1 Khusus untuk Rock Asphalt

3 Stock Yard (Conveyor) 2 Menurunkan kadar air

4 Side Conveyor 2 Transfer RoM (Raw of Material)

5 Feed Conveyor to Sludge 1 Transfer RoM (Raw of Material)

6 Sludge Mixer or Bladder (+ Vent Condenser) 1 Pembuatan lumpur RoM

7 Chain Conveyor or Sludge Pump 1 Transfer lumpur

8 Extractor 1 Counter-Current Process

9 Sentrifuge Separator 1 Pemurnian Miscella (Solvent+Bitumen) > 99%

10 Screw Conveyor 1 Transfer Solid-Liquid

11 Desolventizer 1 Solvent Recovery

12 Economizer 1 Heat Recovery

13 Blower 1 Support untuk Dust Separation

14 Dust Separator 1 Separator debu halus, sedang, kasar.

15 Cyclone 3 Pengambilan Filler

16 Screw Conveyor 1 Transfer ampas

17 Conveyor to Dump 1 Sisa ampas dibuang untuk fill-in

18 Evaporator I 1 Memisah bitumen dari solvent

19 Dome & Condensor 1 Pendinginan

20 Solvent Work Tank 1 Menampung Make-Up Solvent (recycle)

21 Water-Solvent Separator 1 Mengambil Solvent dari air

22 Vacuum Jet 1 Menjaga kondisi Light Vacuum

23 Stripper Condenser 1 Mengambil Solvent

24 Fresh Solvent Tank 1 Mensupply kehilangan solvent dalam proses

25 Evaporator II 1 Menspesifikasi Modifier

26 Dome & Condensor 1 Pendinginan Oil

27 Oil Work Tank 1 Pemisahan Oil

28 Chain Cooler Conveyor + Bagging 1 Tangki Modifier dan Pengepakan

29 Bag Filler 1 Pengepakan Filler

30 Oil-Heated Boiler (10 MKCal) 1 Sumber pemanasan

31 1 MW Fluidized Power Plant 1 Supply listrik untuk penggerak

Infrastructure Notes

Electricity facilities are mostly in adequate, therefore, at the initial stage, a diesel generator will be needed. However, the by product is a coal like product which would be used to fire up the electricity. This will need additional equipment, but is included in the investment.

Skilled labor is not available, thus, key labor will have to be imported. It is important to consider to move up the local population as unemployment is quite high.

By Working with the local authorities, safety should not be a problem.


Harbour & Plant Locations


Harbour & Plant location


Infrastructure Value

Time Schedule


I LEGAL ASPECTS & COMPANY ESTABLISHMENT

- Set the Core Team (Head Office)

- Establishment of the Company

- Management of the Company Permits

- Preparation Head Office

- Licensing Branch Office (P. Buton)

- Handling Plant Location Permit

- EIA

II PRE-DEVELOPMENT PROJECT

- Plant Design & Lab. for Sample Modifier

- Conception Design

- Basic Design

- Detail Design

- Prequalification / Tender

- Product Licensing Abroad (Brand, MOU, JV, etc.)

- Making Sample in Lab. UGM

- Sample shipment to overseas

- Build Lab. for Modifier

III DEVELOPMENT PROJECT

Implemented in BUTON

- Soil Preparation Plant in Buton (+/- 2 Ha)

- Road Construction

- Construction of Plant

- Making Machines

- Delivery to the Plant Machinery

- Installation of Machinery

- Testing & Commissioning

- Procurement of Infrastructure (Tanks, Genset)

- Procurement of Vehicles Factory

- Procurement of Office Equipment Factory

- Employee Recruitment Factory

IV PRODUCTION

- Trial Production

- Commercial Production

V MARKETING

- Arrangements for Export Permit

- Member Renewal in the Asphalt Institute USA

- Membership in the Association of Asphalt (others)

Bln-20Bln-13 Bln-14 Bln-15 Bln-16Bln-03 Bln-04 Bln-17 Bln-18 Bln-19Bln-05 Bln-06No. ITEMS

Pre-Development Project Development Project

Bln-21 Bln-22 Bln-23 Bln-24Bln-07 Bln-08 Bln-09 Bln-10 Bln-11 Bln-12Bln-01 Bln-02

Financial Aspect Size of the Project, Breakdown of Investment


Size of the project This project will build 1 plant with 50.000 metric ton/amount capacity.

With a total investment of US$ 34,831,267 Million, the project feasibility analysis (10 years) result is: Payback Period is 4 Years, 8 Months with ROI 38,98% and ROA 16,61%.

The investment breakdown is as follows:

Plant & Equipment : 85,66%

and

Working Capital : 14,34%


Project Notes The operational stages for the project are scheduled accordingly covering technical design, detail engineering drawing design, plant construction, production plan, pre-operational management scheme, project fund sources scheme, operational and marketing timeframe schedule. All of these would become a stage of activities that goes simultaneously.

From the Investors approval and due diligence is approx 20-24 months. The commercial production can start after 20 months. Pre-marketing should be conducted 9-12 months before commercial production. At the present stage there are expressions of interest from Australia, China, South Korea & UK.

Headed by Ir. Sayono as patent holders and inventor of Buton asphalt extraction technology, the project will be executed by a group of selected experts in their fields as well as management and marketing team with international standards.


Financial Summary


`

GENERAL INFORMATION

NAME OF PROJECT Asphalt Buton Extraction

LOCATION Kabungka, P. Buton, Sulawesi Tenggara

TOTAL INVESTMENT USD 29.835.060

TOTAL WORKING CAPITAL USD 4.996.207

PROJECT PERIOD 15 years (included 2 years Pre Operation)

PRODUCTION MACHINE Indonesia

PROSES Use Patent owned by Ir. SAYONO (Inventor)

No. Patent: ID 0004877, Extraction Process for Refining

The Buton Island's Asphalt Using Organic Solvents

PRODUCTION CAPACITY 50.000 Nominal Ton / Year

with work days 300 days per years, 24 hours per day

EXPORT MARKET Korea ( FOB Selling price ), Australia, England, USA

LABOUR On Plant Site, P. Buton 149 person

On Head Office, Jakarta 26 person

INVESTMENT SCHEDULE Preparation (pra construction) during 6 months USD 1.589.500

Construction during 18 months USD 28.245.560

WORKING CAPITAL SCHEDULE During 4 months Operasional on Year 3 4.996.207

34.831.267

10 Tahun 12 Tahun 15 Tahun

PROJECT FEASIBILITY ANALYSIS 1. Payback Period 4 Years 8 Months 4 Years 8 Months 4 Years 8 Months

2. NPV USD 54.693.887 USD 70.335.469 USD 100.792.043

3. IRR 39,28% 40,89% 42,27%

FINANCIAL ANALYSIS 1. Gross Profit Margin 69,60% 68,63% 68,12%

2. Operating Income Ratio 37,02% 35,31% 39,10%

3. Net Profit Margin 27,77% 26,48% 29,33%

4. R O I 38,98% 38,89% 45,57%

5. R O A 16,61% 14,09% 13,01%

FINANCIAL POSITION 1. Total Asset USD 147.829.844 USD 174.805.180 USD 249.113.818

2. Retain Earnings USD 108.611.860 USD 135.471.321 USD 206.352.255

3. Cash Balance USD 131.395.196 USD 163.208.975 USD 236.263.740

T O T A L

Profit & Loss


Year 1 Year 2 Year Year Year Year Year Year Year Year Year Year Year Year Year

USD % (6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 TOTAL REVENUE Prod. & Sales 703.634.228 100,00% 0 0 29.166.667 39.950.000 45.951.000 52.176.060 54.121.608 55.204.040 56.584.141 57.998.745 59.448.713 60.934.931 62.458.304 64.019.762 65.620.256

2 COST OF GOOD SOLD COGS 224.289.295 31,88% 0 0 8.661.028 11.610.515 13.271.234 15.134.374 16.157.451 17.037.225 18.006.498 19.049.850 20.166.129 21.360.438 20.203.806 21.084.034 22.546.715

3 GROSS PROFIT 479.344.933 68,12% 0 0 20.505.639 28.339.485 32.679.766 37.041.686 37.964.157 38.166.815 38.577.643 38.948.895 39.282.584 39.574.493 42.254.499 42.935.728 43.073.541

4 OPERATING EXPENSES

- Head Office Overhead Fixed Cost 0 0 785.567 834.333 886.514 942.347 1.002.088 977.111 1.045.509 1.118.694 1.197.003 1.280.793 1.370.449 1.466.380 1.569.027

- Transport Cost (Factory - Banabungi) 4 Ton 33,33 0 0 243.056 326.389 368.056 409.722 416.667 416.667 416.667 416.667 416.667 416.667 416.667 416.667 416.667

- Transport Cost (Banabungi - Makasar) 1 Ton 15,00 0 0 437.500 587.500 662.500 737.500 750.000 750.000 750.000 750.000 750.000 750.000 750.000 750.000 750.000

- Transport Cost (Makasar - Overseas) 30 Ton 4.990 0 0 4.851.389 6.514.722 7.346.389 8.178.056 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667

- Retribution Local Government Ton Production1,20 0 0 210.000 240.000 270.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000

Total Operating Expenses 134.208.592 19,07% 0 0 6.527.511 8.502.944 9.533.458 10.567.624 10.785.421 10.760.444 10.828.842 10.902.028 10.980.336 11.064.127 11.153.782 11.249.714 11.352.360

5 MORTGAGE DEBT 10% / annum 10% 35.000.000 0 0 3.500.000 3.500.000 3.500.000 3.500.000 3.500.000 10.500.000 10.500.000 10.500.000 10.500.000 10.500.000 0 0 0

6 EARNINGS BEFORE TAX 275.136.340 39,10% 0 0 10.478.128 16.336.540 19.646.308 22.974.062 23.678.736 16.906.371 17.248.801 17.546.867 17.802.248 18.010.367 31.100.717 31.686.015 31.721.181

7 Income Tax 25% 0 0 2.619.532 4.084.135 4.911.577 5.743.515 5.919.684 4.226.593 4.312.200 4.386.717 4.450.562 4.502.592 7.775.179 7.921.504 7.930.295

8 NET EARNINGS 206.352.255 29,33% 0 0 7.858.596 12.252.405 14.734.731 17.230.546 17.759.052 12.679.778 12.936.601 13.160.150 13.351.686 13.507.775 23.325.537 23.764.511 23.790.886

Note :

1 Retribution Local Government = 6 % x USD 20 /Ton Raw Material

2 Transport Cost to Overseas, size 40 Feet (30 Ton) = USD 4.990

3 Transport Cost Factory - Banabungi IDR 300.000 /4 Ton = USD 33,33 / 4 Ton

4 Transport Cost Banabungi - Makasar USD 15 / Ton

T O T A L (15 Years)NO. ITEMS Ref. Standar

Cash Flow



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

I INCOME

- Sales Prod. & Sales 0 0 26.736.111 39.051.389 45.450.917 51.657.305 53.959.479 55.113.837 56.469.133 57.880.861 59.327.883 60.811.080 62.331.357 63.889.641 65.486.882

II EXPENSES

- Purchase Raw Material Raw Material 0 0 4.083.333 4.369.167 5.247.458 6.227.302 6.553.980 7.012.759 7.503.652 8.028.907 8.590.931 9.192.296 9.835.757 10.524.260 11.260.958

- Purchase Solvent BP (Solvent) 0 0 2.654.167 2.839.958 3.410.848 4.047.746 4.260.087 4.558.293 4.877.374 5.218.790 5.584.105 5.974.992 6.393.242 6.840.769 7.319.623

- Purchase Diesel Fuel BP (Diesel Fuel) 0 0 1.057.583 1.131.614 1.359.092 1.612.871 1.697.481 1.816.304 1.943.446 2.079.487 2.225.051 2.380.805 2.547.461 2.725.783 2.916.588

- Water Cooling Cost BP (Others) 0 0 47.775 57.330 67.721 79.008 82.958 87.106 91.462 96.035 100.836 105.878 111.172 116.731 122.567

- Water Cleaner Cost BP (Others) 0 0 8.400 10.080 11.907 13.892 14.586 15.315 16.081 16.885 17.729 18.616 19.547 20.524 21.550

- Direct Labor Cost COGS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

- Repair & Maintenance COGS 0 0 449.064 480.498 514.133 550.123 588.631 629.835 673.924 721.099 771.576 825.586 883.377 945.213 1.011.378

- Plant Overhead COGS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

- Insurance Cost COGS 0 0 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688

- Laboratory Cost (Quality Test) COGS 0 0 100.000 107.000 114.490 122.504 131.080 140.255 150.073 160.578 171.819 183.846 196.715 210.485 225.219

- Head Office Overhead P-L 0 0 696.667 745.433 797.614 853.447 913.188 977.111 1.045.509 1.118.694 1.197.003 1.280.793 1.370.449 1.466.380 1.569.027

- Transport Cost (Factory - Banabungi) P-L 0 0 243.056 326.389 368.056 409.722 416.667 416.667 416.667 416.667 416.667 416.667 416.667 416.667 416.667

- Transport Cost (Banabungi - Makasar) P-L 0 0 437.500 587.500 662.500 737.500 750.000 750.000 750.000 750.000 750.000 750.000 750.000 750.000 750.000

- Transport Cost (Makasar - Overseas) P-L 0 0 4.851.389 6.514.722 7.346.389 8.178.056 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667 8.316.667

- Retribution Local Government P-L 0 0 210.000 240.000 270.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000 300.000

- Mortgage Debt P-L 0 0 3.500.000 3.500.000 3.500.000 3.500.000 3.500.000 10.500.000 10.500.000 10.500.000 10.500.000 10.500.000 0 0 0

- Taxes 0 0 0 2.619.532 4.084.135 4.911.577 5.743.515 5.919.684 4.226.593 4.312.200 4.386.717 4.450.562 4.502.592 7.775.179 7.921.504

Total Operating Expenses 0 0 18.488.621 23.678.912 27.904.031 31.693.435 33.418.528 41.589.685 40.961.134 42.185.697 43.478.788 44.846.396 35.793.332 40.558.346 42.301.435

III OPERATIONAL INCOME 0 0 8.247.490 15.372.477 17.546.886 19.963.870 20.540.951 13.524.153 15.507.999 15.695.164 15.849.094 15.964.684 26.538.024 23.331.295 23.185.446

IV INVESTMENT EXPENSES

- Pre Development Period (6 Months) Pre-Dev (1.589.500) 0

- Development Period (18 Months) Pre-Dev

* Plant & Office (Buton) Pre-Dev 0 (27.213.060)

* Head Office Overhead 0 (1.032.500)

Total Investment Expenses (1.589.500) (28.245.560) 0 0 0 0 0 0 0 0 0 0 0 0 0

V CAPITAL INJECTION

- For Investment Expenses 29.835.060 1.589.500 28.245.560 0 0 0 0 0 0 0 0 0 0 0 0 0

- For Working Capital *) 4.996.207 0 0 4.996.207 0 0 0 0 0 0 0 0 0 0 0 0

Total Capital Injection 34.831.267 1.589.500 28.245.560 4.996.207 0 0 0 0 0 0 0 0 0 0 0 0

VI NET SURPLUS 0 0 13.243.697 15.372.477 17.546.886 19.963.870 20.540.951 13.524.153 15.507.999 15.695.164 15.849.094 15.964.684 26.538.024 23.331.295 23.185.446

VII BALANCE BROUGH FORWARD 0 0 0 13.243.697 28.616.174 46.163.060 66.126.929 86.667.881 100.192.033 115.700.032 131.395.196 147.244.291 163.208.975 189.746.999 213.078.294

VIII BALANCE CARRIER FORWARD 0 0 13.243.697 28.616.174 46.163.060 66.126.929 86.667.881 100.192.033 115.700.032 131.395.196 147.244.291 163.208.975 189.746.999 213.078.294 236.263.740

Note :

*) Working Capital = 4 Months x Operational Expenses on Year 3

NO. ITEMS Ref.

Financial Analysis



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 Operational Income 0 0 26.736.111 39.051.389 45.450.917 51.657.305 53.959.479 55.113.837 56.469.133 57.880.861 59.327.883 60.811.080 62.331.357 63.889.641 65.486.882

2 Operational Expenses 0 0 18.488.621 23.678.912 27.904.031 31.693.435 33.418.528 41.589.685 40.961.134 42.185.697 43.478.788 44.846.396 35.793.332 40.558.346 42.301.435

NET PROCEED 0 0 8.247.490 15.372.477 17.546.886 19.963.870 20.540.951 13.524.153 15.507.999 15.695.164 15.849.094 15.964.684 26.538.024 23.331.295 23.185.446

3 Initial Cash Flows

- Investment (1.589.500) (28.245.560)

- Working Capital (4.996.207)

4 Net Cash Flow (1.589.500) (28.245.560) 3.251.283 15.372.477 17.546.886 19.963.870 20.540.951 13.524.153 15.507.999 15.695.164 15.849.094 15.964.684 26.538.024 23.331.295 23.185.446

5 Acc. Net Cash Flow (1.589.500) (29.835.060) (26.583.777) (11.211.301) 6.335.585 26.299.455 46.840.406 60.364.559 75.872.558 91.567.722 107.416.817 123.381.501 149.919.525 173.250.820 196.436.266

6 PROJECT ANALYSIS

- PAYBACK PERIOD 4 Years 8 Months 4 Years 8 Months 4 Years 8 Months

- Discount Factor 7% 7% 7%

- Net Present Value (NPV) USD 100.792.043 USD 70.335.469 USD 54.693.887

- IRR 42,27% 40,89% 39,28%

15 Years (include 2 Years Pre-Operation) 12 Years (include 2 Years Pre-Operation) 10 Years (include 2 Years Pre-Operation)

NO. ITEMS

Product & Sales Projection



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 PRODUCTION VOLUME

- Production Capabilities % 70% 80% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

- Total Production (Modifier) 50.000 Ton 0 0 35.000 40.000 45.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000

- Beginning Inventory Ton 0 0 0 5.833 6.667 7.500 8.333 8.333 8.333 8.333 8.333 8.333 8.333 8.333 8.333

- Ending Inventory Ton 0 0 5.833 6.667 7.500 8.333 8.333 8.333 8.333 8.333 8.333 8.333 8.333 8.333 8.333

2 SALES Ton 0 0 29.167 39.167 44.167 49.167 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000

3 PRICE 1.000 USD/Ton 0 0 1.000 1.020 1.040 1.061 1.082 1.104 1.132 1.160 1.189 1.219 1.249 1.280 1.312

4 TOTAL SALES USD 0 0 29.166.667 39.950.000 45.951.000 52.176.060 54.121.608 55.204.040 56.584.141 57.998.745 59.448.713 60.934.931 62.458.304 64.019.762 65.620.256

5 RECEIVABLE USD 0 0 2.430.556 3.329.167 3.829.250 4.348.005 4.510.134 4.600.337 4.715.345 4.833.229 4.954.059 5.077.911 5.204.859 5.334.980 5.468.355

6 CASH RECEIPT USD 0 0 26.736.111 39.051.389 45.450.917 51.657.305 53.959.479 55.113.837 56.469.133 57.880.861 59.327.883 60.811.080 62.331.357 63.889.641 65.486.882

Note:

1 Inventory of Finish Goods = 2 months production

2 Price goods increase 2 % to 2,5% / year

3 Receivable Life in 1 month

NO. ITEMS Standar Unit

Cost of Good Sold



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 COST OF PRODUCTION

VARIABLE COST:

- Raw Material Cost Raw Material 0 0 3.500.000 4.239.167 5.102.117 6.065.108 6.482.519 6.936.296 7.421.836 7.941.365 8.497.260 9.092.069 9.728.513 10.409.509 11.138.175

- Cost of Solvent BP(Solvent) 0 0 2.275.000 2.755.458 3.316.376 3.942.320 4.213.637 4.508.592 4.824.194 5.161.887 5.523.219 5.909.845 6.323.534 6.766.181 7.239.814

- Cost of Diesel Fuel BP(Diesel Fuel) 0 0 906.500 1.097.944 1.321.448 1.570.863 1.678.972 1.796.501 1.922.256 2.056.813 2.200.790 2.354.846 2.519.685 2.696.063 2.884.787

- Other Cost:

- Water Cooling BP(Others) 0 0 47.775 57.330 67.721 79.008 82.958 87.106 91.462 96.035 100.836 105.878 111.172 116.731 122.567

- Water Cleaner (Processing) BP(Others) 0 0 8.400 10.080 11.907 13.892 14.586 15.315 16.081 16.885 17.729 18.616 19.547 20.524 21.550

- Labor Cost 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Total Variable Cost 0 0 6.737.675 8.159.979 9.819.569 11.671.190 12.472.674 13.343.810 14.275.828 15.272.985 16.339.836 17.481.253 18.702.451 20.009.008 21.406.893

FIXED COST:

- Repair & Maintenance Fixed Cost 0 0 449.064 480.498 514.133 550.123 588.631 629.835 673.924 721.099 771.576 825.586 883.377 945.213 1.011.378

- Plant Overhead Fixed Cost 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

- Insurance Cost Fixed Cost 0 0 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688

- Laboratory Cost (Quality Test) Fixed Cost 0 0 100.000 107.000 114.490 122.504 131.080 140.255 150.073 160.578 171.819 183.846 196.715 210.485 225.219

- Depreciation Fixed Assets Fixed Cost 0 0 2.739.056 2.739.056 2.739.056 2.739.056 2.739.056 2.703.556 2.703.556 2.703.556 2.703.556 2.703.556 0 0 0

- Amortization (Cost Put Off) Fixed Cost 0 0 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.752 0 0 0

Total Fixed Cost 0 0 3.655.558 3.693.992 3.735.117 3.779.121 3.826.205 3.841.085 3.894.991 3.952.671 4.014.388 4.080.428 1.229.780 1.305.386 1.386.285

TOTAL COST OF PRODUCTION 0 0 10.393.233 11.853.972 13.554.686 15.450.311 16.298.878 17.184.894 18.170.819 19.225.656 20.354.224 21.561.681 19.932.231 21.314.394 22.793.179

2 BEGINNING FINISH GOODS 0 0 0 1.732.206 1.975.662 2.259.114 2.575.052 2.716.480 2.864.149 3.028.470 3.204.276 3.392.371 3.593.613 3.322.038 3.552.399

3 ENDING FINISH GOODS 0 0 1.732.206 1.975.662 2.259.114 2.575.052 2.716.480 2.864.149 3.028.470 3.204.276 3.392.371 3.593.613 3.322.038 3.552.399 3.798.863

4 COST OF GOOD SOLD 0 0 8.661.028 11.610.515 13.271.234 15.134.374 16.157.451 17.037.225 18.006.498 19.049.850 20.166.129 21.360.438 20.203.806 21.084.034 22.546.715

Note :

1 Labor cost increase 7 % / Tahun

2 Ending Inventory of Finished Goods = 2 months production

NO. ITEMS Ref.

Cost Overhead (Factory & Head Office)



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 FACTORY OVERHEAD (Buton Island)

- Repair & Maintenance Maintenance/yr 3,0% 449.064 480.498 514.133 550.123 588.631 629.835 673.924 721.099 771.576 825.586 883.377 945.213 1.011.378

- Cost of Factory Overhead Labor Cost 30,0% 0 0 0 0 0 0 0 0 0 0 0 0 0

- Insurance Maintenance/yr 1,0% 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688 149.688

- Laboratory Cost (Quality Test) per year 100.000 100.000 107.000 114.490 122.504 131.080 140.255 150.073 160.578 171.819 183.846 196.715 210.485 225.219

- Depreciation Fixed Assets Assets 0 0 2.739.056 2.739.056 2.739.056 2.739.056 2.739.056 2.703.556 2.703.556 2.703.556 2.703.556 2.703.556 0 0 0

- Amortization (Cost Put Off) Assets 0 0 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.750 217.752 0 0 0

Total Factory Fixed Cost 0 0 3.655.558 3.693.992 3.735.117 3.779.121 3.826.205 3.841.085 3.894.991 3.952.671 4.014.388 4.080.428 1.229.780 1.305.386 1.386.285

2 OVERHEAD KANTOR PUSAT (JKT)

- Bod, BoC & Staff Salary (Head Office) Pre-Dev 12 0 0 522.000 558.540 597.638 639.472 684.236 732.132 783.381 838.218 896.893 959.676 1.026.853 1.098.733 1.175.644

- Head Office Rent Pre-Dev 0 0 81.000 86.670 92.737 99.228 106.174 113.607 121.559 130.068 139.173 148.915 159.339 170.493 182.428

- Official Travel Abroad Pre-Dev 12.500 2 0 0 25.000 26.750 28.623 30.626 32.770 35.064 37.518 40.145 42.955 45.961 49.179 52.621 56.305

- Domestic Official Travel Pre-Dev 1.000 12 0 0 12.000 12.840 13.739 14.701 15.730 16.831 18.009 19.269 20.618 22.062 23.606 25.258 27.026

- Head Office Overhead Pre-Dev 2.500 12 0 0 30.000 32.100 34.347 36.751 39.324 42.077 45.022 48.173 51.546 55.154 59.015 63.146 67.566

- Other Cost Pre-Dev 2.222 12 0 0 26.667 28.533 30.531 32.668 34.955 37.401 40.019 42.821 45.818 49.026 52.457 56.129 60.058

- Depreciation Fixed Assets Assets 0 0 88.900 88.900 88.900 88.900 88.900 0 0 0 0 0 0 0 0

Total Head Office Fixed Cost 0 0 785.567 834.333 886.514 942.347 1.002.088 977.111 1.045.509 1.118.694 1.197.003 1.280.793 1.370.449 1.466.380 1.569.027

Note :

1 All cost (except Depreciation & Amortization) increase 7 % / year

NO. ITEMS Ref. USD Unit

Raw Material Cost



(6 months) (18 months) 3 4 5 6 7 8 9 10 11 12 13 14 15

1 PRODUCTION

- Production Capabilities % 70% 80% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

- Total Production (Modifier) 50.000 Ton 0 0 35.000 40.000 45.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000 50.000

2 RAW MATERIAL

- Standard of Raw Material Required 1 Ton Modifier = Kali 0 0 5 5 5 5 5 5 5 5 5 5 5 5 5

5 Ton Raw Material

- Standar Price Raw Material 1 Ton = 20,00 USD 0 0 20,00 21,40 22,90 24,50 26,22 28,05 30,01 32,12 34,36 36,77 39,34 42,10 45,04

- Beginning Inventory Ton 0 0 0 29.167 33.333 37.500 41.667 41.667 41.667 41.667 41.667 41.667 41.667 41.667 41.667

USD 0 0 0 583.333 713.333 858.675 1.020.869 1.092.330 1.168.793 1.250.609 1.338.151 1.431.822 1.532.049 1.639.293 1.754.043

- Purchase Raw Material Ton 0 0 204.167 204.167 229.167 254.167 250.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000

USD 0 0 4.083.333 4.369.167 5.247.458 6.227.302 6.553.980 7.012.759 7.503.652 8.028.907 8.590.931 9.192.296 9.835.757 10.524.260 11.260.958

- Ending Inventory Ton 0 0 29.167 33.333 37.500 41.667 41.667 41.667 41.667 41.667 41.667 41.667 41.667 41.667 41.667

USD 0 0 583.333 713.333 858.675 1.020.869 1.092.330 1.168.793 1.250.609 1.338.151 1.431.822 1.532.049 1.639.293 1.754.043 1.876.826

- Raw Material Consumption Ton 0 0 175.000 200.000 225.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000 250.000

USD 0 0 3.500.000 4.239.167 5.102.117 6.065.108 6.482.519 6.936.296 7.421.836 7.941.365 8.497.260 9.092.069 9.728.513 10.409.509 11.138.175

Note :

1 Price of Raw Material increase 7 % / year

2 Raw Material stock for using 2 month production

3 FIFO method

NO. ITEMS Standar Satuan

Thank You For further information please contact:

Ignatius Wirawan N. I 0817 0090 263 I @ [email protected]

Agung Kristianto I 0811 142 260 I @ [email protected]

aspal buton project 2013

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