Barito River shutdown seen to affect Adaro

The shutdown of the Barito River shipment route since June 5 by the local Barito Kuala Regency administration in South Kalimantan is seen to affect coal miners in the region particularly IDX-listed PT Adaro Coal Energy Tbk, Kontan reported on Thursday.

The paper quoted equity analyst at PT Ciptadana Securities, Andre Varian as saying that Adaro has a coal mine in Balangan Regency, where the main coal transportation system is via the Barito River.

Andre, however, said that the impact on the company?s income would be relatively minor. ?The Barito River blockade will only have about 5 percent effect on Adaro?s income,? he said.

William Surya Wijaya, an analyst at PT Asjaya Indosurya Securities, believed that the shutdown will only be temporary, meaning that it would not affect Adaro?s performance in the long term.

Adaro declined to comment.

The Barito Kuala Regency administration shuts down the Barito River shipment route due to disagreement among vessel operators and port operator with regards to the scout fee.

Minister of Trade M. Lufti has urged the regency administration to revoke the policy as it disrupts the distribution of coal and goods in the region. (*)