Pama increases H1 coal production, renegotiates contracts

Indonesia?s top coal mining contractor PT. Pama Persada Nusantara said on Tuesday that its coal production in the first semester of the year increased to 29.3 million tons from 23.9 million tons in the same semester of last year.

The company also said it had removed 210.7 million bcm of overburden during the period, up from 159.6 million bcm in the last year period.

Pama, a wholly-owned subsidiary of IDX-listed heavy equipment distributor PT.United Tractors, is the largest mining services provider in the country. The company?s existing clients include PT Adaro Indonesia, PT Indominco Mandiri, PT Kaltim Prima Coal, Tambang Batubara Bukit Asam, and PT Kideco Jaya Agung.

Meanwhile, the company said its South Kalimantan coal mining unit PT Dasa Eka Jasatama (DEJ) sold 947,000 tons of coal in the second quarter of the year, down from 1.021 million tons in the previous quarter.

During the quarter, Pama renegotiated its sales contracts to buyers.

Under the new terms of the contracts, around one third of monthly deliveries will be sold at fixed prices; around two thirds at the relevant coal index less costs for barging, transshipment, marketing and other costs, it said

Pama will also receive an uplift of US$4.5 / ton for coal delivered from January to mid June 2008. In addition, this new arrangement will provide Pama with a floor price protection of US$ 70/ton for each monthly delivery.

DEJ's coal is sold to Noble Group and Glencore AG through UT's coal British Virgin Island-based trading arm Scenic Worldwide Ltd. under term contracts. (denny)