ATPK sets Rp100 billion for capex this year

By Tri Subhki R

IDX-listed coal mining firm PT ATPK Resources Tbk has set aside Rp100 billion for capital expenditure (capex) for this year primarily for adding new heavy equipment and for land acquisition to help maintain coal production at its concession in Berau regency, East Kalimantan.

?We allocate about Rp100 billion for capital expenditure to add more heavy equipment and land acquisition in a bid to maintain our coal production,? ATPK Director Albert J Bangun said on Thursday.

ATPK sets 2.5 million tons of coal production target in 2015, and had produced 388,000 tons in the first quarter of the year. The company produces the coal from its 3,274 ha concession in Berau regency through its subsidiary company PT Mega Alam Sejahtera (MAS).

Elsewhere, ATPK said it prefers short term coal sales contract with its customers who are mainly from India to help avoid over production.

?We prefer short term contract, for instance two-month contract, with the customers. We produce when there are already coal sales contracts,? Albert said.

He added that the company tends to avoid longer term contract, for example six months, in a bid to avoid overproduction.

Albert suggested that short term contract provides benefits both for the customers and the company instead of longer term contract. ?Let us say that we have an agreement of four shipments per month in a long term contract, but when the coal price goes higher, the customers may not send their vessels,? he said.

Editing by Reiner Simanjuntak