Thai?s Banpu Indonesian coal mining operations update

The following is excerpt from Thai energy conglomerate Banpu Plc?s Investor/Analyst Meeting on November 25, 2003 for the quarter ended 30 September 2003.

COAL RESERVES & RESOURCES
London-based consulting engineers Steffen, Robertson & Kirsten (UK) Ltd.?s (SRK) recent review of Banpu's reserves showed 92% in Kalimantan, of which one-third in Trubaindo

INDOMINCO
Bontang terminal enhancements progressing well
? Production: 1.6 million tons (mt) output in Q303 -slightly lower than Q203 but 9% higher than Q302; YTD 4.8 mt, 27% higher than 9-month 02; Q4 should see c.1.8 mt output
? Stripping ratio: 7.6:1 -slightly higher than Q203 but slightly lower than Q302
? Logistics: Bontang terminal enhancement progressing well with aim to increase from 6 million tons per annum (mtpa) to 8.5 mtpa by Jan 04 and to accommodate post Panamax vessels

JORONG
Jorong's new BWE system will start operating in Q403
? Production: 0.7 mt output in Q3 (same as Q203 and Q302); YTD 2.0 mt, 10% higher than 9-month 02 (driven by better sales)
? Stripping ratio: 3.9:1 -slightly higher than Q203 but c.50% better than Q302
? Excavation system: BWE system fully implemented -to start Q4; should save $0.1/BCM
? Logistics: Barge loading terminal being improved to increase loading efficiency and reliability

KITADIN
SR higher due to minor mudslide and new pit preparation
? Production: 0.6 mt output in Q303, 8% lower than Q203 due to lower sales (but flat vs Q302); YTD 2.0 mt output (same as 9-month 02)
? Stripping ratio: 8.8:1 in Q3, 23% higher than Q203 due to minor mudslide in mine pit and new pit preparation for 2004 production
? Expansion project: feasibility study being prepared -expected by Jun 04; note that Kitadin coal 'resources' over 70mt

NEW PROJECTS (TRUBAINDO)
The Trubaindo project is progressing well
? Finance: info memo to banks by Nov 03; financial close by Apr 04
? Infrastructure: contracts executed for road, port, coal stockyard and bridge construction
? Reserves and mine planning: laser topographic survey started Sep; drilling program started Oct (ending Dec 03)
? Other: land compensation programme progressing well (86%complete); community development plan being drafted

BANPU COAL SALES TONNAGE Q3
Coal sales increased strongly in the quarter
? Coal sales in the quarter 3.9mt up 28% from previous quarter -mainly from Indominco and Jorong
? Indominco coal sales increased by approx 44%
? Thai sales up thanks to higher import prices
? Kitadin sales down due to mudslide and production problems Jul-Sep 03

BANPU COAL SALES BY SOURCE AND DESTINATION (Q3)
? Japan was again the single most important market for Banpu'scoal in the quarter (sourced from Indominco)
? Thermal spot coal prices in Asia increased around c.20% during the quarter

REGIONAL MARKET REVIEW (Q3)
Thermal spot coal prices in Asia increased around c.20% during the quarter
? Demand: Strong Asian demand:
- Economic recovery China, Korea, Taiwan
- Japanese utilities increasing coal stocks (pre-carbon tax Oct)

? Supply: Chinese and Australian supply problems:
- Chinese mine closures in Shanxi province
- Australian $ strength
- Higher demurrage costs and freight rates

Q4 OUTLOOK ?
Banpu shipments are likely to be flat in Q4

Banpu
? Shipments likely to be flat:
- port upgrade downtime (November) at Bontang and Jorong
- Indonesia wet season
? Banpu prices not likely to increase/decrease in line with market spot price due to high % of price committed sales in contracts

Market
? Growth in Japanese, Korean and Taiwanese markets
? But Japanese nuclear returning
? Asian traded spot thermal price outlook positive for higher grade products
? Continued competitiveness problems for Australian thermal coal
? Fundamental growth emerging in Europe. (*)