Govt guarantees PLN will get coal supply despite price problem

The government has guaranteed that state electricity company PT Perusahaan Listrik Negara (PLN) will get sufficient coal supply from producers although they have not reached an agreement on coal prices.

Bambang Setiawan, the director general of coal and geothermal at the energy and mineral resources ministry said in Jakarta on Wednesday that the price problem would not affect coal supply to PLN?s power plants because both PLN and suppliers had agreed on the volume of coal supply.

PLN earlier said that the company and coal producers still disagreed on the prices of coal for shipment this year as producers demanded the price to be based on the current market rate, while the state electricity company wanted the rice to be based on the official price reference.

According to the 2010 decree on mineral and coal reference prices, the monthly coal reference price to be based on the average of reference prices for the previous three months.

However, coal producers said that the official price reference did not reflect the actual price in the market.

The official coal reference price in January this year was $112 per ton, 8.6 percent increase from $103 in December of last year, meanwhile the market price has reached almost $130 per ton.(giok)