Bayan?s 2013 coal output falls by 15.4%
Friday, May 2 2014 - 04:08 AM WIB
IDX-listed coal mining firm PT Bayan Resources Tbk said that coal output last year fell by 15.4 percent to 13.7 million tons compared to the previous year volume due to lingering weak global coal market.
The company said in its annual report released on Wednesday that four coal projects/concessions including PT Gunung Bayan Pratama (GBP), PT Wahana Baratama Mining (WBM), PT Teguh Sinar Abadi (TSA), and PT Firman Ketaum Perkasa (FKP), which produced high CV coal, accounted for 9.4 million tons, or 68.6 percent of the total production, while the balance were contributed by PT Perkasa Inakerta and PT Bara Tabang concessions.
WBM is located in South Kalimantan, while the rest are located in East Kalimantan.
The company said that revenue last year declined by 19.4 percent to US$1.15 billion year-on-year, while gross profit fell 2.4 percent to $163.4 million on lower sales volume and average selling price (APS).
Bayan said that APS in 2013 was $77 per ton compared to $88.6 per ton in the previous year. Sales volume also went south to 14.7 million tons, or down by 8 percent as production volumes were also reduced.
?Bayan also had to account for an unrealized foreign exchange loss of $ 44.7 million on its VAT receivables and an impairment charge of $42.6 million on its MCM assets which together generated a operating loss of $30.2 million for 2013,? the company said in the report.
?As a result of the drop in coal prices, we conducted a comprehensive review of all mine plans and associated stripping ratios at all sites. In this regard, we reduced stripping ratio and production levels at all sites in 2013 other than the Tabang concessions,? it added.
Elsewhere, Bayan reported the following production performances of its concessions.
PT GBP Block 2 (GBP Block 2) produced 3.5 million MT in 2013 which was approximately 7.9 percent lower compared to the previous year. In the second half of 2013, the company switched from owner operated coal mining and coal hauling to a third party rental company.
PT GBP Block 1 (GBP Block 1) produced insignificant volumes in 2013. Mining of the SP Block was completed in the early part of the year. Mining in Keham Block has not started operation due to unresolved land borrowing and use permit issue with concession holder.
PT WBM produced 3.2 million MT in 2013 which was 15.8 percent lower compared to 3.8 million MT of coal produced in 2012. The cessation of mining by Arutmin on the joint boundary area has impacted mining operations especially on the low-wall, and consequently the mining sequence needed to be amended which negatively impacted production.
PT PIK produced 2.1 million MT in 2013 which was 16.0 percent lower compared to 2.5 million MT of coal produced in 2012. BUMA and PIK agreed to the mutual termination of the existing subcontractor contract at the end of November 2013 due to the planned decrease in PIK production. HKU was appointed as a new contractor and commenced production in November 2013.
PT TSA produced 0.7 million MT in 2013 which was the same volume as the previous year.
PT FKP produced 2.0 million MT in 2013 which was 33.3 percent lower compared to 3.0 million MT of coal production in 2012. The Kinong pit commenced in the second half of the year. However, land compensation will continue to be challenging which will impact the mining sequence to a great extent.
PT Fajar Sakti Prima, PT Bara Tabang and PT Brian Anjat Sentosa ( all under FTB) produced 2.2 million MT in 2013 which was an increase of 10.0 percent from 2.0 million MT of coal produced in 2012. The forestry ?Pinjam Pakai? permit was obtained in the first half of 2013 and the contract for the construction of a coal haul road linking the concessions to Senyiur was awarded to Petrosea. They commenced work in the second half of the year.
The Pakar project will leverage off the Tabang projects infrastructure and so the focus is now on obtaining all required permits to allow for the commencement of operations.
Due to the high cost of the company's mining operations Mamahak Project (MCM) requires more focus on exploration activities with the objective of developing the region's coal reserves and mine design, while exploration in the other concessions around MCM mine is still running throughout the year 2013, the annual report said.
The following table summarizes Bayan?s coal production by projects/concessions from 2009 to 2013 (in million tons)
| Project Name | 2009 | 2010 | 2011 | 2012 | 2013 |
| GBP Block II | 4.0 | 3.4 | 3.4 | 3.8 | 3.5 |
| GBP Block I | 0.4 | 0.4 | 0.4 | 0.3 | - |
| WBM | 2.9 | 2.6 | 4.3 | 3.8 | 3.2 |
| PIK | 2.0 | 2.7 | 3.2 | 2.5 | 2.1 |
| TSA&FKP | 1.3 | 1.6 | 2.6 | 3.7 | 2.7 |
| FTB | 0.8 | 1.2 | 1.7 | 2.0 | 2.2 |
| Mamahak | - | - | - | 0.2 | - |
| Total | 11.4 | 11.9 | 15.6 | 16.3 | 13.7 |
Editing by Reiner Simanjuntak