Bumi secures sales contract at $85 per ton

IDX-listed coal miner PT Bumi Resources Tbk claimed that it has secured 82 percent sales contract of its expected coal production this year, of which 67 percent of the contract would be priced at more than US$85 per ton.

The company's President Director Dileep Srivastava said that 15 percent of the sales contract would use the government?s price index. ?But we predict the price would still be around $85 per ton,? he said as quoted by Investor daily.

Bumi sold 15.8 million tons of coal in the first quarter of this year at an average price of US$91.6 per ton, in which 80 percent went to domestic market with the remaining exported to China, India, Japan, Taiwan and South Korea.

This is 13.6 percent higher from last year's first quarter sales record at 13.9 million tons, sold at US$87.6 per ton in average.

"I'm optimistic that coal prices will go back up with winter coming," he said, adding that the company plans to lower its mine stripping ratio from 11.5 to 10 this year, as well as paying half of its US$3.8 billion debt.

To finance its debt repayment, it plans to sell 20 percent shares of Bumi Resources Minerals Tbk at the end of the third quarter the latest, targeting to acquire US$400 million from the sales. Bumi currently controls 87 percent of BRM shares.

It also expects to receive US$125.5 million loan payments from Recapital Group from its total US$251 million loan. Bumi also plans to retract US$231 million worth of investment from the group.(*)