MEC to start railway construction in mid-2012

MEC Coal, a subsidiary of the Trimex Group, expects to start construction of a 130-km railway in East Kalimantan in the middle of 2012, a company executive said on Tuesday.

"We expect to start construction in the first quarter or second quarter of this year but it will be subject to the progress of land acqusition," said Mesra Eza, MEC Coal's Vice President for Planning and Development.

The firm is in the process of acquiring the remaining 10 to 15 kilometer of the total land needed for the railway, Mesra said.

Construction of the railway will take two years, he added.

The infrastructure projects includes building the 130-kilometers coal railway and ship loading jetty facility.

The company has said that it has secured license from government to construct and operate the coal railway. The railway is designed to operate as integrated coal delivery system from mine to vessel.

MEC expects its coal mine in East Kalimantan will start production next year, the firm has said.

The mine will initially produce 1 million tons per year and the output will be gradually ramped up to a peak production of 34 million tons in 2015, it said.

The mine has 1.5 billion tons of JORC resources with sulphur 0.15%-0.18%, ash 3-4% and calorific value of 5,200-5,300 kcal/kg (ADB).(fitri)