Adaro?s Q1 coal production, sales slightly decrease
Saturday, April 30 2011 - 02:23 AM WIB
AI coal sales were also down by 5 percent during the quarter to 10.91 Mt.
The lower relative production compared to the same period last year was largely due to the dry weather conditions in the third quarter of 2009 enabling AI to achieve overburden mining performance in excess of the planned rate establishing higher levels of Run of Mine (ROM) coal inventory offsetting the impact of wet weather conditions and increase coal production levels in 1Q10, the company said.
In addition to that, the downtime due to repairs and maintenance of some of the heavy equipment also contributed to lower production volume compared to the first quarter of 2010.
AI?s coal production and coal hauling performance for the firs quarter of 2011 was 103% and 101% of the plan respectively and AI is on track to achieve its production target of 46-48 Mt in 2011.
AI?s new coal product called Wara coal, continued to receive strong demand. AI is on track to achieve the annual production targets of 4-5 Mt after producing and selling 1.2 Mt of Wara coal in the first quarter of 2011.
During 1Q11, PT Pamapersada Nusantara (PAMA) was responsible for 41% of AI?s coal production. PT Bukit Makmur Mandiri Utama (BUMA) and PT Rahman Abdijaya were responsible for 13% and 16% respectively. AE?s subsidiary PT Saptaindra Sejatiproduced 28%, while AI itself mined 2% of the coal production.
PT Rante Mutiara Insani, a contractor that initiated the development of the Wara pit, is now focusing on removing overburden at this same pit.
In order to ensure AI?s commitment to meet delivery targets to its customers during the wet seasons of 2011, AI made a strategic decision to build inventory stockpiles at both Kelanis and at the mine site to create a buffer against unseasonal weather related factors that could interrupt production.
AI has entered into long-term contract agreements with all its mining contractors to provide coal transportation services from AI?s mining area to certain destinations. The rate of the contracts remains the same during the duration of the contracts, which shall expire in a period from 2013 to 2015. The contracts are calculated based on certain formula, which includes the amount of coal or overburden transported.
Due to the Japanese earthquake in March 2011, some heavy equipment deliveries from Japanese suppliers may be delayed. As a precaution AI is seeking secondary suppliers and develop contingency plans and as at the end of the quarter did not anticipate an impact to achieving 2011 production targets. (denny)