ICMA expects lower coal output in Sumatra this year

By Cepi Setiadi

The Indonesia Coal Mining Association (ICMA) said that coal production in Sumatra is projected to decline this year as dozens of miners particularly in Jambi have shut down operations amid weak prices and unfavorable local administration policy.

ICMA Executive Director Suspriatna Suhala told Petromindo.com on Monday that coal output in Sumatra had been hovering at around 30-35 million tons per year, or about 10 percent of national output. But this year, he projected production in Sumatra to fall to below 30 million tons, accounting for only around 8 percent of the country?s total output. ?This year, output may be less than 30 million tons,? he said.

Supriatna said that the Jambi administration regulation banning the use of public road for coal hauling has sent dozens of miners to stop operation. The current downturn in the global coal market, which has seen prices collapse, squeezing margins, has also severely hurt the miners in Jambi.

Of the 37 coal mining companies operating in Jambi, Supriatna said, only seven are now still operating.

Editing by Reiner Simanjuntak