Bahari Cakrawala Sebuku produces 1.2m tons of coal in first half

PT Bahari Cakrawala Sebuku produced a total of 1.246 million tons of coal at its Sebuku coal mine in South Kalimantan in the first half of 2004, while coal sales were 1.237 million tons in the period, up 40 percent on the corresponding period last year.

Australian mining company Straits Resources, which owns 80 percent of the company, in its first-half report described the production level as "excellent".

Straits further said that mining activity concentrated in the Kanibungan pit whilst in the northern Tanah Putih mining area, work focused on pre-stripping waste in preparation for this location becoming the future, main operating pit. Strip ratios, at 3.2, were slightly higher than budget due to the pre-stripping occurring at Tanah Putih. The mining contractor performed very well during the period and has made a positive contribution to the significant improvement in production relative to 2003.

The Coal Preparation Plant (CPP) continued to perform well, a combination of dry weather and high percentages of bypass coal achieving monthly production rates of up to 240,000 t of coal production.

All coal sales met customer quality requirements and shipments of low sulphur product to Japanese utilities, utilizing gearless vessels, commenced in this reporting period.

The Sebuku coal mine EBITDA and EBIT were US$8.7m respectively for six months to 30 June 2004, a significant turnaround from the equivalent results in 2003-an EBITDA loss of US$0.7m and EBIT loss of US$2.4m. Higher coal prices received in conjunction with increased production and improved operating costs contributed to this results. Mining unit costs of production have fallen with cash operating costs 21% lower and total production costs 27% lower then the same period last year.

Exploration continues within the coal Contract of Works area and a small amount of coal has been added to the existing resource.

Sebuku?s reputation as a reliable supplier of coal has served it will during a period of tight coal stocks, and as coal buyers increasingly look to Indonesia for coal supplies. This in conjunction with the ability to supply a new, lower sulphur coal product has lead to a number of long term arrangements being put in place with important Japanese and Korean utility companies.

Increasingly, spot sales are being replaced with longer-term contracts thus securing benefits from the high coal prices prevalent at this time. (hotma)

TABLE

?	Unit	H1 2004	H1 2003	2003	2002	2001
Overburden mined	?000 bem	4,418	3,386	6,071	7,060	7,869
Coal mined	?000 tons	1,379	1,144	2,146	2,455	2,251
Coal product	?000 tons	1,246	997	1,964	2,065	1,969
Coal sold	?000 tons	1,237	886	1,991	2,005	1,976