Kideco ?not allowed? to increase output to 40m tons

Coal miner PT Kideco Jaya Agung will only produce about 37.4 million tons of coal this year, the same with last year?s output level, Kontan daily reported.

Despite the lingering weak coal price, the company had initially proposed a higher production of 40 million tons this year, but was rejected by the government amid plans to limit the country?s production, said Kim Sung Kook, President Director of PT Tristan Resources, a subsidiary of Thailand?s Samtan Co Ltd, which owns a 49 percent stake in Kideco.

?We think all companies wanted to increase their coal production, but the government of Indonesia wants to limit the (country?s) coal production, that?s why we maintain production at the same level as last year?s,? Kim said.

To help maintain that production level, the company has allocated US$30 million in capital expenditure for this year, mostly to be used for buying supporting facilities and equipment. The heavy equipment and mining equipment would be provided by coal mining services firms Samindo Resources and Pama Persada as the contractors, Kim said.

Kideco exports part of its coal output to South Korea, Taiwan, Japan and Spain, while the remainder sold in the domestic market.

Kideco, which is 51 percent controlled by IDX-listed PT Indika Energy Tbk, owns coal concessions in Paser Regency, East Kalimantan. Kiim said that Samtan has plans to acquire new concessions with high calorific value of coal. (*)