Dubai-based Emaar Properties and the Indonesian Government on Monday said they have extended a joint venture to develop a planned $600 million tourism and residential area on Indonesia's Lombok Island by six months after delays hampered the project.
"The joint venture partnership has been extended until December 31, 2009, to complete all modalities associated with developing a mixed-use project set on the Kuta and Tanjung beaches on the island of Lombok," Emaar and state-owned PT Pengembangan Pariwisata Bali said in a joint emailed statement.
The representatives of the Indonesian Government and Emaar International met in Dubai to finalise on the project.
Last week, the Jakarta Globe newspaper reported that the project may fail if the government is unable to reach a deal with Emaar over the long-delayed project by June 19.
The project has been hampered by delays in acquiring land for the development from local residents, and problems over joint venture arrangements.
Indonesia was to have developed an infrastructure plan, including construction of an international airport on the island.
The project delayed due to the land acquisition difficulties and is still incomplete despite Emaar granting a six month extension to the presentation deadline, the English-language daily quoted Alwi Shihab, Indonesia's special envoy to the Middle East, as saying.
"To undertake such a complex project, taking into account all environmental and development considerations, it is important to evaluate all aspects thoroughly. We have therefore extended the joint venture by six months," Shihab said in the statement on Monday.
Sergio Casari, chief executive of Emaar International, said Indonesia is a key market for the Dubai-based developer.
"Our expansion to the country is in line with the company's growth strategy of geographic expansion and business segmentation," he said.