PTBA in talks to increase stake in S. Sumatra coal railway project

IDX-listed coal mining firm PT Tambang Batubara Bukit Asam (PTBA) plans to increase its stake in a venture to build the $1.3 billion railway in South Sumatra to 30 percent from 10 percent currently, Investor daily reported Thursday.

The 307-km railway will carry coal from PTBA's mine in Bangko Tengah area in South Sumatra to Srengsem area in Lampung.

PTBA gets an offer by Rajawali Group, which has just bought an 80 percent interest in a railway project from PT Transpacific Railway Infrastructure, PTBA?s president director Sukrisno said.

The joint venture called PT Bukit Asam TransPacific Railway (BATR) consists of PT Bukit Asam (Persero) with a share ownership of 10 percent, PT Transpacific Railway Infrastructure (80 Percent) and China Railway Engineering Corporation (CREC) (10 percent).

The project is expected to start construction at the end of this year or early 2011 at the latest. The railway is scheduled to start operation in mid or end of 2014 and will be able to transport 25 million tons of PTBA?s coal per year. (*)