Orpheus: Production at ADK coal project resume to normal

By Romel S. Gurky

ASX-listed coal miner and trader Orpheus Energy Limited said that mining and trucking operations at ADK coal mine in South Kalimantan have returned to normal levels since November 21 following disruption caused by bad weather earlier in the month.

By December 2, Orpheus had mined and transported 27,690 tons from the ADK project to the SKJM stockpile, the company said on Tuesday.

?Since 2 December, 20,000 tons have been loaded on to barges and sold to an Indonesian trading group at benchmark prices and with cash payment received upfront,? it said.

The remaining coal on stockpile and the coal being delivered daily from ADK are also under contract to be sold to the same group in December. These sales are part of an agreement with the Indonesian trading group to purchase at least 30,000 tons and all additional available coal from ADK.

?Orpheus is on track to mine, haul, load and sell 50,000 tons of its ADK coal in the month of December,? the company said. ?The net sales margin achievable from Orpheus?s own production means that should this sales figure be achieved, the company will be operational cash-flow positive this month.?

Additionally, with a favorable upward movement in the coal price over the last month of approximately $1.00 per ton for 4,200 kcal GAR coal to US$39.65 FOB Mother Vessel (Indonesian Coal Index, 6 December 2013) per ton, there will be a marginally improved return to Orpheus on coal sales, it explained.

Wet weather also affected the movement of coal contracted by Orpheus from local miners to both SKJM Port and Abidin Port 1. It is anticipated that volumes and sales from trading operations will commence from early 2014.

Editing by Reiner Simanjuntak