Sakari reports flat 2011 coal production

By Alexander Ginting

Singapore-listed Indonesia-focused coal mining group Sakari Resources Limited reported on Tuesday that 2011 production from its Indonesia mines reached 10.664 million tons (MT), slightly higher than previous year?s production of 10.550 MT.

The Jembayan mine in East Kalimantan contributed 8.9 MT to the group?s overall production with the balance came from Sebuku mine in South Kalimantan.

The company reported that coal production at Jembayan slowed during the fourth quarter of 2011 due to torrential rain - including 423mm in December vs. the 5-year monthly average of 177mm - and the adverse effects on barging down the Mahakam River arising from the collapse of the public Tenggarong Bridge. As announced in mid-December 2011, the Mahakam River has since reopened to upstream barge traffic.

Sebuku?s fourth quarter production of 758,000 tons was the result of excellent mine management and planning by the Sebuku team coupled with a favorable run in the weather, the company said, adding that the focus of the management team is concentrated on the Northern Leases, which alone contributed 350,000 tons in the fourth quarter of 2011.

The company reported that for the first time its annual sales exceeded US$1 billion as the Group produced an outstanding year end Net Profit after Tax of $190 million, more than double that of 2010.

Sakari?s programmes have delineated over 1 billion tonnes of resources over the past 4 years that are now flowing into reserve numbers. In this vein, 2011 showed a strong improvement in Jembayan‟s JORC marketable reserves to 142MTt in October 2011, it said.

The company also reported that high rainfall that Jembayan continued to face until Jnauary 2012 has influenced some sequences in Jembayan?s mine plan schedule for the start of the year. As a result the mining fleet is currently focused on the movement of overburden as part of operations to open new pits in the second half of 2012, which means that production for 2012 will have a slow start in the first half, and particularly in the first quarter

?The next phase of growth for Jembayan will therefore begin in second half of 2012, which will also follow completion of a cost and logistics review. In this way the mine can be geared for its next major production push with confidence that it will be operating at optimum efficiency,? it said.

Kt	Q4		Full Year
Sebuku	2011	2010	2011	2010
Coal mined	833	584	2,050	1,268
Product coal	758	495	1,772	1,104
Sales	862	481	1,825	1,092
Jembayan
Coal mined	1,925	2,595	8,514	8,514
Product coal	1,674	2,333	8,892	9,446
Sales	2,215	2,419	8,901	9,621
Total
Coal mined	2,758	3,179	10,564	10,555
Product coal	2,432	2,828	10,664	10,550
Sales	3,077	2,900	10,726	10,712

Editing by David Mustakim