Orpheus Energy sells 60,000 tons in first quarter

By Ruli Setiawan

ASX-listed Orpheus Energy Limited announced on Wednesday that it sold a total of 60,000 tons of coal in the first quarter of the year, citing that poor weather has hampered its production activities.

The firm said its trading division sold approximately 30,000 tons of coal in each of January and February, but none in March due to poor weather.

It achieved an average sale price in line with the benchmark Indonesian Coal Index (ICI) price for the sales of 4200GAR thermal coal in the March quarter. During the quarter, the ICI averaged US$38.59/t, which was a 1.7 percent decrease from the December quarter, following on from a 5.7 percent drop over the previous quarter.

The firm said its ADK production has been impacted due to continuing poor weather during the March quarter, thereby affecting river diversion, overburden removal and water pumping activities. Additionally, a new area of the ADK tenement focused on the thick Seam 5 took longer to prepare for coal extraction than had been anticipated.

?Post reporting date, mining activities are normalizing and coal is now being mined and transported to SKJM Port at the rate of 500 - 1000 tons per day. It is anticipated the coal production rate will increase as additional mining equipment is moved onto site over the coming weeks,? the firm said.

The firm further said it had fundamentally changed its operational structure and let go of 65 percent of its mining staff at the ADK site and replaced them with a mining contractor. The arrangements with the mining contractor are aimed at increasing the rate of production at ADK, by only remunerating contractors on a per ton of coal mined and transported to port basis.

The firm is continuing to work with JV partner, PT Mega Coal, to deliver value from existing assets through the potential sale of non-core and non-performing assets. Such cash proceeds will significantly bolster the company's balance sheet.

It is actively looking at a number of geographically and geologically diverse potential near-term cash-flow projects to complement the Indonesian operations.

Orpheus has a 50 percent interest in Orpheus?s JV partner PT Mega Coal?s ADK operating coal mine located in South Kalimantan.

Coal Production/Sales

Thousands of Tonnes	Quarter Ended			YTD
	Mar-14	Mar-13	Change	Mar-14	Mar-13	Change
Coal Production	0	20,104		29,767	64,129
Coal Trading	60,086	0		81,729	0
Total Coal Sales	60,086	20,104	198.87%	111,496	64,129	73.86%

Editing by Johannes Simbolon