PT BA to reduce coal concession area in West Sumatra

State owned coal mining company PT Tambang Batubara Bukit Asam (PT BA) will reduce its coal mining concession area in Sawahlunto and Sijunjung regencies in West Sumatra to 4,000 hectares from about 15,228 hectares at present, Bisnis Indonesia reported on Monday.

Bambang Istijono, the head of the mining office of West Sumatra provincial administration, said in Padang last week, that the company had formally submitted its application to reduce its concession areas in the two regencies.

"The local governments in the two regencies are still processing the request," he said, adding that PT BA decided to reduce its concession area in the two regencies because it considered it would be too costly to carry out the mining activities in the entire mining area.

The coal mining activities in the area has not been optimal, because during its presence for almost 100 years in the area, PT BA is only able to produce 30 million tons through an open-pit mining activities. Compared to its coal reserve which is expected to reach 100 million tons, the production is still too small.

To maximize the production, PT BA should carry out underground mining activities. But according to the company, such mining activities are still too expensive. (*)