Adaro starts production of Balangan Coal

By Romel S. Gurky

IDX-listed coal giant PT Adaro Energy Tbk said it has started production at its Balangan coal project in Balangan Regency, South Kalimantan, shipping the maiden output to Thailand.

The company said on Monday that production was started at PT Semesta Centramas (SCM), one of the three coal license companies that form the Balangan coal project.

?The coal is branded as Balangan Coal, and has similar low pollutant characteristics as our Envirocoal. We produced 77,335 tons and shipped 53,274 tons of Balangan Coal to a customer in Thailand. We are pleased with the development of Balangan Coal and will continue exploration to fully detail the coal resources and reserves in accordance with JORC,? Adaro said in a statement on Monday, adding that it plans to produce up to 1 million tons this year from Balangan.

Adaro acquired last year 75 percent shares in SCM and two others firms including PT Paramitha Cipta Sarana (PCS) and PT Laskar Semesta Alam (LSA) that form the Balangan coal project. The remaining 25 percent shares are held by local businessmen. The three firms hold a combined concession area of 7,500 hectares.

Adaro said that production at SCM started after construction of the hauling road and bridge linking with the infrastructure facilities of PT Adaro Indonesia (AI), which operates the company?s key mines, has been completed.

?Balangan Coal is strategically located 11km southeast of AI?s concession. We also use in-house contractors and AI?s existing infrastructures such as the privately-owned haul road and Kelanis to keep the cost to produce Balangan Coal relatively low. PT Saptaindra Sejati (SIS) is responsible for all mining activities from overburden removal and coal hauling. SIS will deploy more heavy equipment to support Balangan Coal?s future production plan. PT Maritim Barito Perkasa is responsible for the coal barging and shiploading activities,? the statement said.

Adaro said it plans to produce up to 1 million tons of coal in 2014 from Balangan as this coal continued to receive interest from a range of customers, including those from Thailand, India and Indonesia.

Editing by Reiner Simanjuntak