Kanci-Pejagan Toll Road

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In 1997, the Ministry of Public Works awarded the Kanci-Pejagan Toll Road to the consortium of PT Bakrie to build a 54km highway connecting Kanci and Pejagan in West Java. The highway was slated to connect to the existing Palimanan-Kanci Toll Road as part of the 1500 km trans java toll road network. 80% of the shares in the project company were held by PT Bakrie Investindo. Other shareholders included the private Indonesian firm PT Arthayasa Karya Bina Caraka with 12-percent and the Indonesian state-owned road-construction and –operation company, PT Jasa Marga with eight-percent. The Kanci-Pejagan Toll Road was originally awarded through direct negotiation in 1997, but it was delayed due the economic crisis by Presidential Decree no 39 of 1997. Presidential Decree no 15 of 2002 revoked Presidential Decree no 39 of 1997, and allowed the resumption of the projects if deemed necessary by the President. In December 2005, thirteen toll road projects including the Kanci-Pejagan were re-evaluated by the federal government. The project reached financial closure in March 2007 with a syndication given by Bank Negara Indonesia Tbk (BNI) and Bank Rakyat Indonesia (BRI). PT Semesta Marga Raya (SMR) worth Rp. 1.389 trillion ($US 151.2 million). BNI was the syndication leader, with 65% of the total credit or IRp. 897.6 billion, (US $98.2 million) while the remaining 35% was covered by BRI. President Director of BNI, Sigit Pramono, stated that the effective interest rate is 14% during construction, reaching a value worth Rp. 139 billion with a grace period up to 3 (three) years. The Kanji-PejaganToll Road project was estimated to cost approximately Rp. 2.09 trillion, (US $228.6 million). The road was inaugurated on January 26, 2010.