Indonesia Power coal supply tender delayed
Monday, October 29 2001 - 02:58 AM WIB
The company's operational director Bambang Istiadi told Petromindo over the weekend that the planned tender would be participated by a number of big coal companies such as Adaro and Arutmin.
"Because a contract with Suralaya is quite long (three years), they have to consider carefully about the pricing," he said, and thus denying Petromindo's report about Suralaya's coal dual pricing. .
Currently, coal prices are not as good as those a few months ago, when oil prices stayed over $22 per barrel. But since then, oil prices have fallen, and now stand at around $19 per barrel.
Coal producers are a bit worried that if oil prices will drop further to below $15 per barrel, coal users could shift to oil and thus further dampen coal prices.
At the same time, coal producers expect that coal prices would increase again if oil prices increase.
These dilemma has caused Indonesia Power to postpone the tendering, until the fluctuation of coal prices subsides.
"We actually wanted to complete the tender soon, but because of those problems, the plan has to be postponed," he said.
The postponement of the tendering, however, would not affect the level of Suralaya's coal stock, which currently is enough for four days of operation, a much improvement from one-day of operation a few months ago.
"As ;long as your electricity is on, it means Suralaya is still running well," he said.
Suralaya consumes around 30,000 tons of coal per day, or around 11 million tons of coal per annum. It received the coal from state owned coal mining company PT Tambang Batubara Bukit Asam and a number of private companies, including Adaro and Arutmin. (*)