Bayan needs US$400 million for mine expansion

IDX-coal company, PT Bayan Resources Tbk will need at least US$400 million to develop nine coal mines acquired by the company recently as part of its expansion plan.

The company?s President Director Eddie Wai Fong Chin said in Jakarta on Monday that the new coal mines were expected to begin commercial production in five years.

This year, Bayan allocates $255 million in capital expenditure (Capex) which will be used to finance its expansion including the nine coal mines.

The company?s board of directors had not yet decided where to get the funding for the new mines, but Eddie said that the it still had credit lines totaling $950 million with several banks.

?We have agreed to use about $750 million of the loan commitment. It means that we still have $200 million,? he said as reported by Kontan reported.

Bayan, through its subsidiary Bayan Energy, has recently acquired nine coal concession areas. Four of the concession areas are held by PT Tanur Jaya, PT Apira Utama, PT Cahaya Alam, and PT Bara Sejati. The four companies are formerly owned by PT Ithabi Bara Utama and PT Romo Titiyudi Wachjo.

The other five coal mines, which were acquired by Bayan, include concession areas held PT Tiwa Abadi, PT Sumber Api, PT Silau Kencana, PT Orkida Makmur and PT Dermaga Energi. The five companies are owned by Ithabi, Romo Nitiyudi and Prime Mine Resources Limited.

Eddie said that total acquisition value of the nine coal mines reached $325.6 million. (*)