Bumi to decide on production target mid this year

By Hiski Darmayana

IDX-listed coal mining giant PT Bumi Resources Tbk said that it will decide on the 2014 coal production target in the middle of the year as the government is said to issue production quota for miners.

This was said by Bumi Vice President for Investor Relations Reza Widjaja to Petromindo.com recently.

The Ministry of Energy and Mineral Resources plans to limit the country?s coal production this year not to exceed 400 million tons, compared to last year?s production of 421 million tons in a bid to help revive the price of the commodity and to ensure future coal supply for domestic needs. Indonesia is the world?s largest exporter of thermal coal used in power plants.

The government will first evaluate the coal production performance in the first quarter before deciding on what measures to be taken to limit production. Edi Prasodjo, coal director at the ministry, said that among of the planned measures include introducing production quota for miners holding the so-called PKP2B contracts.

Bumi Resources was previously reported that it wanted to increase production this year by 10-15 percent from last year?s estimated production of 80 million tons to meet growing demand particularly in China and India.

Bumi has two coal mining subsidiaries PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia, which hold a combined coal reserves of 3.3 billion tons, and resources of 13.9 billion tons, at their respective concessions in East Kalimantan and South Kalimantan.

Editing by Reiner Simanjuntak