BlackGold, PLN Batubara sign MOU for coal supply cooperation

By Romel S. Gurky

SGX-listed coal firm BlackGold Natural Resources Limited said that announce that its Indonesian subsidiary PT Samantaka Batubara (PTSB) had on March 24 entered into a nonbinding memorandum of understanding with PT PLN Batubara (PLNBB), the coal unit of Indonesia?s state-owned electricity firm PT PLN.

BlackGold said in a statement Wednesday that pursuant to the MOU, PLNBB and PTSB (collectively, the ?parties?) shall consider further cooperation in relation to the supply of coal from PTSB?s concessions to power plants in Indonesia. The manner of the cooperation may be in the form of a joint venture, or any other form agreed upon by the parties. Upon successful completion of the due diligence, the parties will enter into a definitive agreement or term sheet for the cooperation.

Through its coal procurement activities, PLNBB provides support to PLN for the obtainment of coal used in electricity generation. PLNBB?s business strategy is to establish coal supply cooperation agreements, which may include acquiring stakes in mining concessions that hold mining business licenses.

BlackGold has an ongoing coal sales and purchase contract with PT PLN for the delivery of 500,000 tons of coal per annum in respect of the PLN Tenayan coal-fired power plant project.

?We are excited to have inked this MOU with PLNBB?, commented Philip Rickard, the Chief Executive Officer of the BlackGold Group. ?This Cooperation is a sign of the furtherance of our relationship with PT PLN. Through this, we look forward to potentially increasing BlackGold?s existing supply of coal to the PLN Tenayan project and the prospect of supplying to other PLN projects in Indonesia.?

The MOU is not legally binding except for certain provisions relating to, inter alia, confidentiality. The MOU shall be valid for an initial term of one year commencing on the date of the MOU, and may be extended subject to mutual agreement between the parties.

Editing by Reiner Simanjuntak