Three of PLN's coal suppliers have yet to begin production

At least three coal mining companies that have been appointed by state owned electricity company PLN to provide coal for some of the power plants to be built under the government's fast-track program have not begun production, and some of them have not even started exploration, Bisnis Indonesia reported on Friday.

Jeffrey Mulyono, the chairman of the association of the Indonesian coal mining companies (APBI) told the newspaper that the three companies included PT Titan Mining Energy in Jambi, PT Kasih Industri and PT Surya Sakti Dharma, both in South Kalimantan.

He said that two of PLN's suppliers such as PT Arutmin in South Kalimantan and PT Bara Mutiara in South Sumatra needed to increase their production to be able to meet their supply commitments.

"Only two of the coal mining named as PLN's suppliers have begun production. So, PLN should closely monitor the mining progress of its suppliers to ensure that they will be able to meet their supply commitment," he said.

Meanwhile PLN's president director Eddie Widiono said in Jakarta Thursday that the government's crash program to provide additional power supply of about 1,000 MW in three years until 2009 might not be able to be completed according to the initial schedule. This is because the delay in the signing of the engineering, procurement and construction (EPC) contracts for four major coal-fired power plants: PLTU Suralaya, PLTU Paiton, PLTU Labuan and PLTU Indramayu.

The EPC contracts for the four power plants should have been signed in Jan. 31. It has been delayed because the Chinese of Commerce and Industry has refused to issue recommendation for the Chinese contractors to raise funds from Chinese banks.

But Eddie said that he was optimistic that the projects could finally meet the schedule because some Chinese banks had expressed their interest to provide the financing. (*)