Alam Karya, Beringin terminate coal supply contract

By Romel S. Gurky

IDX-listed PT Alam Karya Unggul Tbk said it has reached an agreement with coal miner PT Beringin Jaya Abadi for an early termination of a one-year coal supply contract signed in December of last year.

The company said in a statement Friday that the two companies have decided to end the contract prior to its expiry among others due to the current downturn in the global coal market and price.

Alam Karya, which has primarily been engaged in mining services, signed the agreement on December 5 and was amended a few days later. Under the deal, Beringin will supply 2.5 million tons of coal to Alam Karya, which in turn would provide upfront payment up to $4 million, in which $3.6 million was supposed to have already been paid before end of last year, and the remaining $400,000 to be considered once the coal supply volume has reached 2 million tons.

In July, the two companies signed a similar one-year contract, under which Alam Karya acted as marketing agent for Beringin?s coal.

Editing by Reiner Simanjuntak