Berau Coal sets to up production

East Kalimantan coal miner PT. Berau coal is set to increase coal production to 10 million ton in 2005 from 9 million tons planned for this year, a company official said.

Marketing manager Rudy AR Hernawan told Petromindo.Com that 70 percent of Berau?s 2005 output had been contracted and priced, while another 15 percent is currently being negotiated, leaving around 1.5 million tons to be sold in spot market next year.

Rudy said that Berau would not need to invest in infrastructures addition to boost production, as planned production is still below company?s capacity of 12-23 MTPA.

Rudy said thermal coal price is expected to remain strong in 2005, arguing that additional supply from world coal producers would not match growing demand. ?World coal supply is expected to grow by 25 million tons, mainly coming from Indonesia and Australian coal producers. But he warned that China would still be the most dominant factor to determine coal prices. ?China is rumored to maintain coal export of 80 MT next year. But, once China floods the market, price will tumble. China can do that easily as it is the world?s number one coal producer,? said Rudy.

Berau Coal operates coalmine in Berau regency in the northern part of East Kalimantan. (alex)