Garda Tujuh suspends coal production

By Ruli Setiawan

IDX-listed coal mining company PT Garda Tujuh Buana Tbk has suspended production activity for three months until April due to a number of reasons.

The company said in a statement Wednesday that the drop in global coal price due to a combination of oversupply and weaker demand has severely hit margins despite a drop in cash cost. Other factors include the current rainy season and a structural change in the key market of India following the arrival of a new government.

The company hopes to be able to resume production and export in May or June of this year. Until that time, the company said it would suspend its workers and barge contracts.

Garda Tujuh produces low rank coal at its Pulau Bunyu concession, in Bulungan Regency, East Kalimantan. The mine has coal resources of about 300 million tons and coal reserves of about 168 million tons.

Editing by Reiner Simanjuntak