Thai Banpu to invest $117 million in Indonesian coal mines

Thailand?s coal producer Banpu PCL will invest US$74 million in the Trubaindo coal mine in Indonesia over the next two years, and the mine will start operations by the end of this year, the Dow Jones Newswires reported on Friday, citing the company?s chief executive as saying.

Trubaindo mine will have an initial production of 300,000 tons this year, production will increase to 3 million tons next year and reach a full capacity of 5 million tons in 2006, said Banpu?s chief executive Chanin Vongkusolkit.

Banpu recently bought Indonesia's Bharinto coal mine and will spend $43 million from 2004 to 2007 to develop the mine, Chanin added.

The Daning and Trubaindo projects will boost Banpu's production in 2006 to 21 million tons, Chanin said.

He also said on Friday that Banpu plans to invest $444 million for three years from 2004, in order to increase its coal reserves to around 800 million metric tons in 2008.

Its coal reserves currently total 320 million tons.

Banpu targets total sales of 22 billion baht ($1=THB41.483) in 2005, up 40% on year from an estimated THB15.7 billion this year, thanks to higher production volume and prices of coal products, Chanin told reporters in Bangkok.

Chanin said Banpu's average coal price this year is estimated at $25 a ton.

"The price next year is expected to be above the current level," Chanin said, but declined to indicate how far the company's product price would rise.

Of the $444 million investment, $238 million will be used to develop new coal mines, $58 million will be invested in existing mines and the rest will be used to build a 1,434-megawatt power plant for BLCP Power Ltd, Chanin said.

BLCP is a joint venture between Banpu and Hong Kong-based China Light & Power International.

Banpu will mainly invest in coal businesses in Indonesia and China. (*)