PTBA, Adani sign $1.6b S. Sumatra coal railway deal

Indonesia-listed coal miner PT Tambang Batubara Bukit Asam (PTBA) Wednesday signed head of agreement (HoA) worth $1.6 billion with PT Adani Global, Indonesian unit of India 's Adani Group, to develop a railway and coal terminal project in South Sumatra province.

The railway which will be connected from PTBA?s mine in Tanjung Enim to Tanjung Api-Api port is expected to start construction next year with a completion time between 36-48 months, Investment Coordinating Board (BKPM) Chairman Gita Wirjawan said after the signing of the agreement in Jakarta.

The construction of coal terminal will also start next year with an annual capacity of 50 million tons, he said.

The entire project will be financed by Adani alone, he said. The 270-kilometer railway will have a capacity to transport around 30-35 million tons of coal a year.

When contacted by Petromindo.Com, PTBA?s president director Soekrisno confirmed the signing of HoA on Wednesday in BPKM office in Jakarta, adding that PTBA does not have a share in the project but has a commitment to use the railway to transport its coal.

?We don?t have shares in the project, only transportation commitment,? he said.(godang)