JAKARTA – PT Triputra Agro Persada Tbk (TAPG) has allocated a capital expenditure (capex) budget of IDR 940 billion for 2025, with the majority of the funds earmarked for the construction of a new palm oil mill (PKS) in East Kalimantan.

According to George Oetomo, Director of TAPG, 19% of the budget, or IDR 178.6 billion, will be allocated for palm oil plantation replanting, and another 15%, or IDR 141 billion, will be used for acquiring vehicles and heavy machinery, including mechanisation.

However, the largest portion of the capex, 65% or IDR 611 billion, will be directed towards the construction of the new PKS in East Kalimantan.

“We already have the plantation there, it’s just a matter of increasing its value,” said Tjandra Karya Hermanto, President Director of TAPG, during TAPG’s 2025 Public Presentation on Monday (28/4).

According to the presentation, the new mill will have a capacity of ~45 tons/hour. This will be the company’s 19th mill and will increase the installed capacity to ~1,040 tons/hour.

Despite a 3% and 6% decline in the production of fresh fruit bunches (TBS) and crude palm oil (CPO) in 2024 due to climate challenges, Tjandra remains optimistic that the new PKS will improve transportation cost efficiency for harvesting to the mill, which was previously located farther from the plantation.

George added that the capex will be sourced from the company’s internal cash reserves. “It has been calculated, almost everything will come from the company’s internal cash,” he concluded. (ZH)