Darma Henwa expands to underground mining services

By Maryati Dimursi

IDX-listed mining services firm PT Darma Henwa Tbk has obtained a US$141 million underground mining contract from affiliate mining firm PT Dairi Prima Minerals to develop the latter?s Anjing Hitam block zinc mine in North Sumatra.

Darma Henwa President Director Wahjudi Pramono said on Friday that the contract marks the company?s expansion into the underground mining services to anticipate the switch of mining operations in Indonesia from open pit to underground mine.

Darma Henwa estimates that the mining operation at the Anjing Hitam block would produce about 1 million tons of zinc ores and associated minerals per year.

?We want to become only the underground mining contractor, while the construction of the processing facility and its operation will be handled by Dairi Prima,? said Wahjudi.

Dairi Prima holds a combined 27,420 ha of zinc concessions in North Sumatra and Aceh. Total reserve is estimated at 6.3 million tons.

Darma Henwa is quite serious in developing its new underground mining services unit as the company has recently established a new company for the particular business. It has also cooperated with China?s Nonferrous Metal Industry Foreign Engineering and Construction Co. Ltd, which has been quite experienced in underground mining operation. The company is also preparing training programs for workers dedicated to run the new underground mining operation.

Elsewhere, Wahjudi said the company plans to spend about US$40-43 million for capital expenditure next year.

He said that the company has obtained $15 million worth of loans to help finance the capex plan.

Editing by Reiner Simanjuntak