DISTINCTIVE ADVANTAGES OF PROVINCE

New Center of Growth

Strategic Location Site of Major Industries

Rich Resources Easy Access & Good Transportation network Distinct Culture & Beauty STRATEGIC LOCATION

Riau

Jakarta

Sydney

Close to Malaysia and Singapore (one of RIAU PROVINCE the world’s trade & service hubs)‏ at the crossline of the world’s busiest trade & shipping lane (Malacca Straits)‏ Administration & Demography Territorial size : 107,932 km² (84,461 km² land area) Government : 10 Regencies and 2 Cities Administration Population : • Riau Province 6.4 million • (capital) 1 million

Kuala Lumpur Medan GOOD CONNECTIVITY

Malacca

Batam

Airports Seaports Commercial Destination Flight Time

- - Pekanbaru (regular) - Jakarta 1.20 hours (Northern Gateway) - Medan 50 min. -Tanj. Buton - - KL 45 min. (Middle Gateway) (Malaysia) 50 min. - Kuala Enok - Malacca (Malaysia) 45 min. (Southern Gateway) - Singapore 45 min. - Dumai (non-regular) to Jakarta RICH IN NATURAL RESOURCES REGION WITH FASTGROWING ECONOMY

• Economic growth is steadily ranging from 6-8% (above national average) • GRDP constantly increases at significant level • Developed as the center of palm oil-based industrial cluster • Recording high population growth due to migration of workforce from other regions

Y E A R NO INDICATOR 2010 2011 2012 2013 2014 1 Economic Growth 7.16 7.63 7.82 7.82 6.80

2 GRDP (IDR billion) 342,691.45 413,710.12 469,073.02 522,241.43 426,477.35

3 Export (USD million) 14,891.32 20,139.38 19,144.90 17,557.16 16,545.49

4 Import (USD million) 1,118.58 2,039.39 2,261.99 1,972.52 1,547.02

5 Inflation (%) 6.18 5.90 3.35 8.46 8.65

6 Minimum Labor Wage/Month 124 140 170 (USD) PREFERABLE INVESTMENT DESTINATION

• Up to September 2014, total investment realization reached the amount of Rp. 17.84 trillion (USD 1,699 million); comprising of : a. FDI (PMA) USD 1,102 million (Rp. 11.57 trillion) b. DDI (PMDN) USD 597 million (Rp. 6.27 trillion) • This put Riau at the 7th rank nationally out of 34 Provinces for both FDI and DDI • The figures however placed Riau at the 1st place among Provinces in Sumatera as the most attractive destination for investment • With the present realization, it is predicted tha the BKPM-targeted realization of Rp. 18 trillion (USD 1,714 million) can be overpassed.

MAJOR FOREIGN/MNCs OPERATING IN RIAU

COMPANY BUSINESS COUNTRY/ REMARK GROUP OF BUSINESS

Chevron Oil USA The largest Pacific producing in Indonesia Conoco, Oil USA Mobil Oil, producing Haliburton RAPP Pulp & paper Asia Pacific Resources Among the International Holding largest in the Ltd (APRIL) world IKPP Pulp & paper Asia Pulp and Paper Among the (APP) largest in the world

Pulau Sambu Processed Singapore Food & drink Guthrie Palm oil Malaysia INVESTMENT REALIZATION BY SECTORS

PLANTATION/ PAPER PERKEBUNAN KEHUTANANFORESTRY INDUSTRIFOOD INDUSTRY MAKANAN INDUSTRI KERTAS FARM ESTATES INDUSTRY

OTHER ELECTRICITY & INDUSTRI LAINNYA LISTRIK DAN AIR JASAMISC. LAINNYA SERVICES INDUSTRIES WATER

Rp.Rp. 941.90 941,90 BILLION Milyar

Rp.Rp. 656656,78.78 Rp. 144.52 BILLION BILLIONMilyar Rp. 144,52 Milyar

Rp.Rp. 392,29 392.29 BILLIONMilyar

Rp.Rp. 678,87678.87 BILLION Milyar

Rp.Rp. 4.76 4,76 BILLION Milyar

RpRp.. 2.631,31 2,631.31 BILLION Milyar Riau Polytechnic State-Islamic University

• 6 Universities (3 public, 3 private), 4 Polytechnics, 21 Colleges/Academies; graduates ± 6,139 per year

•37 Vocational High Schools, graduates ± 61,859 per year

10 GROWING IMAGE AS HOST OF MAJOR EVENTS • National Games 2012 (12,000 athletes & officials) • National & International Meetings/ Conferences • Organizations/parties national assemblies INTERNATIONALLY LINKED BANKING FACILITIES

38 units of bank entities; including 6 units of foreign/joint bank (NISP-UOB, Niaga-CIMB, BII – Maybank, Danamon – DBS, Commonwealth Bank)

STATE-OWNED COMPANIES Bank Riaukepri Tower AS LOCAL PARTNERS

• Riau Investment Corporation (RIC) • Bank Riaukepri • Riau Petroleum • Sarana Pembangunan Riau

13

• One-stop Services for Permits and Licenses at Provincial Administration • One-stop Services for Permits and Licenses in every Regency/City Administration (12 Regions) • Investor Complain Board • Coordinating Team for the Strengthening of Investment Climate • Local State-owned Companies as Local Partners • Website : www.riauinvestment.com INFRASTRUCTURE DEVELOPMENT PLANS IN IN RIAU PROVINCE RICH TOURIST OBJECTS AND ATTRACTION

TOURIST OBJECTS/ATTRACTION

GOLF COURSES HOTELS

Culture, Heritage, History, Natural Beauty, Eco-Tourism 16 PROPOSED INVESTMENT PROJECTS

BACKGROUND OF PROJECT

Riau Province is home to the largest oil palm plantation estates in Indonesia with the total area covering 2,258,553 Ha.

Riau Province is also recorded as the largest CPO producer in Indonesia with production amounting to 7,047,221 tons/year (37% of the national production)

There are 165 Palm Oil mills spreading all over the Province

Based on the Master plan for the acceleration and expansion of Indonesia economy (MP3EI), Riau Province is designed as one of the main bases for the development of palm oil-based industries

Dumai, Tanjung Buton and Kuala Enok, the three main seaports in Riau Province, has been declared as the national center for the development of oleo-chemical- based industrial cluster for western Indonesia region

The government of Riau Province desires to enhance added value of CPO into derivative products of higher economic values PROSPECTIVE CPO may be further processed into various derivative products of higher added values

There are only few industries / factories producing CPO into derivative products in Riau Province. Those few, however, only produce cooking oil Proposed - Dumai Industrial Park Location - Tanjung Buton Industrial Park - Hinterlands surrounding the Industrial Parks are palm plantation estates and CPO producing centers as the source of raw The Advantage materials for the downstream industries of Location - Strategic locations; directly facing the straits of Malacca – one of the busies sea and trading lanes in the world and proximity to Singapore – trade and service hub in Southeast Asia Model of - Investor may lease land for industrial premise from the Ind. Park - Investor may make contract with CPO suppliers on market price Cooperation basis Land Title Right to Build 80 years, through the following phases: Period of Land - 30 years Lease - Extendable 20 years - Renewable for 30 years after the extended period Copyright BPMPD 2013 DISTRIBUTION OF PLANTATION, CPO MILL AND PRODUCTION BY LOCATION

DATA 2011 Copyright BPMPD 2013 INVESTMENT OPPORTUNITIES PALM OIL DOWNSTREAM INDUSTRIES

TREE DOWNSTREAM CPO

RELATED INDUSTRY SUPPORT INDUSTRY CORE INDUSTRY (Cooking oil, (Packing, metha- (refinery, fractination, shortening, nol,hydrogen,cata-list, fatty acyd, fatty CBS/CBE/CBX, other chemical alcohol, Biodie-sel) Surfactan, emulsifier, substances). soap, detergent)

Copyright BPMPD 2013

BACKGROUND OF PROJECT

Riau Province is the third biggest rubber plantation estates in Indonesia with the total area covering 504,139 (2011)

Riau Province is also recorded as one of the major producer (the 3rd) in Indonesia with production amounting to 333,070 tons/year (16% of the national production)

There are 15 rubber processing plants spreading all over the Province

Dumai, Tanjung Buton and Kuala Enok, the three main seaports in Riau Province, have been prepared for industrial cluster for western Indonesia region.

The Government of Riau Province desires to enhance added value of rubber into derivative products of higher economic values PROSPECTIVE RUBBER may be further processed into various derivative products of higher added values

Presently, rubber processing industries/factories in Riau Province have only produced crumb rubber, no other rubber-based derivatives are produced. Proposed - Dumai Industrial Park Location - Tanjung Buton Industrial Park - Hinterlands surrounding the Industrial Parks are rubber plantation estates and rubber producing centers as the source of raw The Advantage materials for the downstream industries of Location - Strategic locations; directly facing the straits of Malacca – one of the busies sea and trading lanes in the world and proximity to Singapore – trade and service hub in Southeast Asia Model of - Investor may lease land for industrial premise from the Ind. Park - Investor may make contract with crumb rubber suppliers on market Cooperation price basis Land Title Right to Build 80 years, through the following phases: Period of Land - 30 years Lease - Extendable 20 years - Renewable for 30 years after the extended period Copyright BPMPD 2013 DISTRIBUTION OF PLANTATION AND CRUMB RUBBER PRODUCTION BY LOCATION CRUMB RUBBER CULTIVATED NO. REGENCY/CITY PRODUCTION LAND (Ha) (ton/yr) 1 Kampar 101,342 77,513 2 Rokan Hulu 56,920 49,124 3 Rokan Hilir 26,967 26,099 4 Indragiri Hulu 61,372 40,214 5 Indragiri Hilir 5,194 1,327 6 Pelalawan 27,286 28,473 7 Kuantan Singingi 150,565 55,617 8 Siak 13,851 10,628 9 37,042 33,546 10 Kep. Meranti 18,586 8,570 11 Kota Dumai 2,238 1,311 12 Kota Pekanbaru 2,776 648

TOTAL 504,139 333,070 DATA 2011 INVESTMENT OPPORTUNITIES RUBBER DOWNSTREAM INDUSTRIES

RUBBER DOWNSTREAM TREE

Copyright BPMPD 2013 INFRASTRUCTURE DEVELOPMENT PLANS IN IN RIAU PROVINCE Tanjung Buton Industrial Park and Port) Siak Regency

Cap. 750 M3/Hour

Reverse Osmose Plant Cap. 2 X 120 M3/Hour

Waste Water Treatment Plant • Pre Treatment Cap. 60 m3/hour • Central ETP Cap. 150 M3/Hour THE DEVELOPMENT OF TANJUNG BUTON INDUSTRIAL PARK

• Existing conditions: - Based on Siak Regency and Riau Province Regional Land Use and Spatial Planning Document (RTRW) :  Tanjung Buton is designed as industrial park area.  Tanjung Buton is designed as one of the transportation node (Internasional Port) besides Dumai and Kuala Enok. - A local state-owned company (BUMD) named PT. KITB has been established to manage the industrial park (based on Goverment Regulation of Siak Regency No. 7 of 2004). The subsidiary of PT. KITB, named PT. Samudra Siak has also then established as the port management entity. - Total allocated land for industrial park is 5,192.292 Ha (acquisited), 600 Ha of which has been granted the certificate for Land Concession Right (HPL) - Access Road to the planned industrial park and port has been constructed - The development of Port facilities have commenced since 2007 and still on- going, funded with National Budget (pier, sea-side trestle, land-side terstle, embankment). - Temporaray operational permit by the Ministry of Transportation has been issued (PP103/3/3/DP-12 dated 12 Juliy 2012) - Good accessibility both to the sea (the straits of Malacca, with the distance of 80 miles, and to the Mainland of Sumatera island MASTERPLAN OF KITB

TERMINAL BBM +6.00 mLWS

TERMINAL DRY BULK +6.00 mLWS

DERMAGA 1 Masterplan of KITB:

TERMINAL KONTAINER

JALAN KOLEKTOR

DERMAGA 2 KIB KOLAM PELABUHAN

AREAL PENGEMBANGAN -13.00 mLWS TERMINAL MULTIPURPOSE

DERMAGA 3

DERMAGA 4

DERMAGA 5

TERMINAL CPO DERMAGA 6 +6.00 mLWS

DERMAGA 7 PLAN INDUSTRI DERMAGA 8 TERMINAL PENUMPANG 340 HA +6.00 mLWS JALAN ARTERI KIB  Allocated Land: 5,192.292 Ha

-13 AREAL PENGEMBANGAN

AS PELABUHAN

JALAN KOLEKTOR

KIB  Land which has secured concession right certificate (HPL): 600 Ha

 Development Plan Phase I: 600 Ha :  Port area development: + 300 Ha  Industrial area development: + 233,21 Ha  Green area and road development: + 66,79 Ha

Size: 5,192.292 Ha

SOURCE: REVIEWED MASTERPLAN OF THE MINISTRY OF INDUSTRY BAPPEDAOF 2012 TERMINAL BBM +6.00 mLWS

TERMINAL DRY BULK +6.00 mLWS

DERMAGA 1

TERMINAL KONTAINER

JALAN KOLEKTOR

DERMAGA 2 KIB KOLAM PELABUHAN

AREAL PENGEMBANGAN -13.00 mLWS

TERMINAL MULTIPURPOSE

DERMAGA 3

DERMAGA 4

DERMAGA 5

TERMINAL CPO DERMAGA 6 +6.00 mLWS

DERMAGA 7 PLAN INDUSTRI DERMAGA 8 TERMINAL PENUMPANG KITB Development Plan Phase I (600 Ha) 340 HA +6.00 mLWS JALAN ARTERI

KIB

-13 AREAL PENGEMBANGAN

AS PELABUHAN

JALAN KOLEKTOR

KIB

Port Area: ± 300 Ha A

10.00

BT1 7 4 6 1 2 3 5 1 2 3

8 9 11 10 14 13 12 4 5 6

BT4

9 C 7 8 No. TGL DESKRIPSI OLEH DISETUJUI 16 17 18 PEMBERI TUGAS 4 12 13 14 15 1 2 3 5 11

22 23 24 25 26 NAMA PEKERJAAN 6 10 19 20 21 7 8 9 BLOK PLAN PELABUHAN TANJUNG BUTON

LOKASI

AS1 2 BT5 TANJUNG BUTON D 296 KAB. SIAK - PROPINSI RIAU

300 GAMBAR

301

BT6 BLOK PLAN

C1 URAIAN NAMA TANDA TANGAN Digambar

Direncana

Diperiksa

Disetujui SKALA JML. LEMBAR NO. LEMBAR

1 : 1000 - -

TGL: GBR No. : -

B Industrial Area: ± 233,21 Ha

(A): Length of area along the Shore line: 3,691.74 M (B) : Length of area: 3,618.38 M (C) : Width of area C1 = 1,453.07 M, C2 = 1,460.18 M (D): Access Road Plans (Rigid Pavement) 1,7 Km 2 lanes - 4 rows

HIGHWAY PEKANBARU – TANJUNG BUTON CONSTRUCTION PLAN TO SUPPORT THE DEVELOPMENT OF KITB

SIAK INDRAPURA BUTON PORT

AIRPORT GASIB The Prospect for the Development of The capacity of Dumai Port for CPO Tanjung Buton Port as CPO Port export is only 4 million tons/year, CPO production exported from the Port of Dumai (in ton) meanwhile total CPO export from the Port of Dumai is recorded to have reached 6.6 million tons/year which causes over 50.44 capacity of 2.9 million tons/year. 3 452.52 Duma 4 i The limited capacity 223.62 of the Port of Dumai 7 has caused 621.13 substantial loss to 907.42 8 the shiplines for 8.50 demorage cost, 5 6 amounting to Rp 2.584.75 611.27 106.8 billion/year. (source : GAPKI of 5 7 372.97 2009) 412.98 8 9 361.51 9 Projected Spillover of CPO export from the Port of Dumai to the Port of Tanjung Buton

5.907 621.138 Tanjung Buton Excess loading/ 8.506 unloading activities in the 1.292.378 611.277 Port of Dumai converts to Rp 309.742 2,989,327 billion/year 90.380 THE PROSPECT FOR THE DEVELOPMENT OF TANJUNG BUTON PORT AS OIL DISTRIBUTION TERMINAL

alternative

Projected Oil Distribution from Tanjung Buton Indutrial Park EXISTING INFRASTRUCTURES TO TANJUNG BUTON INDUSTRIAL PARK CONSTRUCTION OF TANJUNG BUTON PORT FACILITIES JETTY FACILITY

39 INSPECTION ON THE JETTY FACILITY

40 EXISTING ROADS TO KITB IN 2013 Electricity Support

The construction of Gas-fueled Power Plant with the capacity of 25 MW, located in Muara Mekar, Desa Sungai Rawa Kec. Sungai Apit has been completed on 20 April 2013