Coal miner Bayan Resources intends to extend a joint venture constructing clean coal plants, to strengthen the company’s position among Indonesian coal firms.
Bayan and White Energy Co. plan to expand the upgrading capacity of the existing joint venture in Indonesia from the current 5 million tons of coal per year to 15 million tons a year.
Bayan and White Energy have sought talks with a few banks to seek debt facilities to assist an accelerated rollout of additional coal upgrading plants in the near term. The two firms will seek to negotiate refinancing for part of the equity contributed by both partners on the first plant.
Bayan’s joint venture with a White Energy unit, PT Kaltim Supacoal, recently completed construction of a modular clean coal plant capable of upgrading up to a million tons of coal every year.
“With the expansion of the joint venture, and the completion of the first clean coal upgrading plant, we are confident that this will increase the value of our reserves of low sulfur sub-bituminous coal, while maintaining a leading position in supplying premium-value, environmentally-friendly upgraded briquettes into the Asian market,” Eddie Chin, president director at Bayan, said in a statement late last week.
Bayan is one of the few Indonesian coal miners that mines and sell high-calorific value coal, aside from other grades of coal, including more environmentally-friendly, low-sulfur sub-bituminous coal and semi-soft coking coal.
The plant at Bayan’s Tabang mine in East Kalimantan Province will use White Energy’s exclusive Binderless Coal Briquetting, or BCB, a clean coal upgrading technology that would give Bayan a competitive edge in its operation and production costs.
Production at the plant is expected to be ramped up to full capacity by the end of this year, with export sales of the more valuable and environmentally friendly BCB coal to start then.
The company estimated that its average cost of production of upgraded BCB coal would be lower than the mining costs for most global thermal coal producers.
Bayan estimates that the upgraded coal will be marketable with a similar or premium price to conventional thermal coal, due to the similar energy yield and its environmental edge, with lower ash and sulfur content. .
Based on test results, the BCB clean coal upgrading technology will allow Bayan’s Tabang low calorie sub-bituminous coal of 4,200 Kcal/kilogram to be upgraded to 6,100 Kcal/kg, while maintaining the low sulfur content of 0.2 percent and low ash content of 3 percent
Bayan estimated that the BCB coal upgrading process is expected to enjoy a favorable long-term coal upgrading price arbitrage.
Source: Jakarta Globe
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