Vale Indonesia allocates lower 2016 capex

By Brigida Ernestina Elu Wea

IDX-listed integrated nickel mining company PT Vale Indonesia Tbk has allocated a lower capital expenditure (capex) of US$90 million-$100 million for this year, compared to $106.39 million last year.

Company Vice President Bernardus Irmanto said on Friday that the capex will be focused on renewal of production equipment both at the mines and processing plant in Sorowako, South Sulawesi.

?Compared to last year, the capex (for this year) is lower. And we see a possibility of further lowering it again. Our current production capacity is in line with what has been planned, so there?s not much spending required,? he said.

Bernardus said that renewal and maintenance of equipment is crucial to help improve efficiency amid the current commodity downturn.

He said that funding for the capex will come from internal source. According to its end 2015 financial report, Vale Indonesia had total cash reserves of $194.75 million.

Vale Indonesia has set production target of 80,000 metric tons of nickel in matte this year, lower than last year?s record output of 81,177 metric tons.

Editing by Reiner Simanjuntak