KPC customers worried over divestment problem

Coal buyers from Japan has started to become nervous over further delay in the divestment program of the East Kalimantan-based coal mining giant PT Kaltim Prima Coal (KPC).

A source at a Japanese trading house told Petromindo.com that buyers were concerned that the delay could lead to a blockade of KPC operation by the local people.

?Until now, Japanese customers are not planning to terminate contract. But they?re considering to delay shipment until June,? the source said.

The government and KPC have agreed to delay the deadline for the KPC divestment to June from end of March.

The delay was unavoidable because the East Kalimantan administration had declined to drop an earlier lawsuit against KPC until the company agreed to treat the province as the preferred bidder of the KPC stake.

KPC is obliged to divest up to 51 percent stake to local buyers.

KPC exports a significant portion of its output to Japan.

Meanwhile, KPC marketing staff Tuty Suryoputro said so far production had been running normally at KPC. And until now no customers had rescheduled shipment or terminate contract.

KPC operates a vast mining site in Sangatta, East Kalimantan. (Alex)