Indika aims for 40m tons output this year

By Thomas R. Sembiring

IDX-listed integrated energy company PT Indika Energy Tbk plans a slightly lower production target of 40 million tons this year, compared to last year?s target of 41 million tons.

Indika President Director Wishnu Wardhana said on Tuesday that the lower target is because of the lingering weak coal price.

The relatively stagnant coal output this year would also cause the company to cut down capital expenditure for this year to below US$100 million, compared to last year?s $113 million.

Wishnu said that to help cope with the lingering downturn in the global coal market, the company would continue efficiency measures to help maintain margins.

He added that the current drop in oil price has allowed the company to reduce operational costs as fuel accounts for about 30 percent of the costs.

Indika has three coal mining subsidiaries including Kideco Jaya Agung (in Paser Regency, East Kalimantan), Santan Batubara (in Kutai Kartanegara and Kutai Timur regencies, East Kalimantan, in a joint venture with Petrosea and PT Harum Energy Tbk), Multi Tambangjaya Utama (a high-rank coal miner in Central Kalimantan), and Mitra Energy Agung (operates a greenfield coal assets in East Kalimantan).

Editing by Reiner Simanjuntak