Aneka Tambang expects a decline in net income for the first half this year, citing drops in ferronickel sales and nickel prices.

Alwinsyah Lubis, president director of Antam, said the company's unaudited net income for the first half could decline to around Rp 500 billion ($53 million), a 51 percent decrease from last year.

It will release its audited first-half financial report by the end of this month.

The miner's first-semester revenue stood at Rp 4.5 trillion, down from Rp 4.8 trillion a year ago.

Alwinsyah cited a drop in ferronikel sales and a fall in nickel prices in explaining the net income results. "The nickel price dropped sharply to $8 per pound in the first semester from $11 per pound," he said.

Ferronickel sales accounted for about 31 percent of Antam's revenue in the first half.

Alwinsyah said the company was focusing on reaching its production target of 3.1 tons of gold this year, to compensate for the drop in nickel prices. It is targeting sales of seven tons of gold this year at about $1,600 per kilogram.

Antam has anticipated the government's decision to ban raw material exports by 2014 by adding several projects to its portfolio. These included a $450 million chemical-grade alumina plant in Tayan, West Kalimantan, a $1.6 billion ferronickel plant in East Halmahera, North Maluku, and a ferronickel plant in Pomalaa, Southeast Sulawesi.

The company also expects to complete a feasibility study on a proposed smelter-grade alumina plant in Mempawah, West Kalimantan. "Next year, we will start to look for financing for the project, which is expected to cost around $1 billion," he said.

Alwinsyah said Antam had received financing offers from many banks but none had turned into a deal.

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Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.Read the Terms of Service