PTBA signs coal sales agreement with Indonesia Power

IDX-listed PT Bukit Asam Tbk has on March 14, 2013 signed sales agreement with state electricity company PLN,s subsidiary PT Indonesia Power (PT IP) for between 5 and 8 million tons per annum of coal with 5,000 kcal/kg CV (GAR) on FOB basis via Tarahan Port.

PTBA said in a statement to the IDX on Thursday that the coal will be used as fuel for the Suralaya power plant in Merak for a period of 10 years between January 1, 2013 to December 31, 2022. Coal price, the company said, would be decided by both parties for each year during the contract period, with aspects such as Indonesian coal price reference (HBA) and railway transportation cost as the determining factors.

PTBA has been supplying coal for the Suralaya power plant ever since the plant started its operation, however this is the first deal where the coal is sold on FOB basis, while previous transactions were done on CIF basis.

Editing by Er Audy Zandri