Indo Tambangraya Expects 25 Per Cent Rise In 2010 Coal Output

Indonesian coal miner, PT Indo Tambangraya Megah, expects coal output to increase by up to 25 percent next year as production kicks in at some new mine areas, the company's president said on Tuesday.

Commercial production at a mine at its PT Bharinto Ekatama unit is expected to start at the end of 2010, Somyot Ruchirawat told reporters.

"For production in 2010, we will try to increase from Bharinto, the East Block and PT Trubaindo Coal Mining. It will be a 20-25 percent increase from the 2009 production target," Ruchirawat said.

The company plans to produce 20.5 million tonnes this year.

Indo Tambangraya has received a permit to start development of the East block of coal mines operated by PT Indominco Mandiri.

The company said it was also looking at buying coal mines to increase output, but did not elaborate on a timeframe.

"We are still in talks...It could be anything, whether it's a green-field or existing mine," Ruchirawat said.

The company had a warchest of more than $200 million to fund mining acquisitions, but it also may seek loans, he said.

The company, which is a unit of Thailand's Banpu PCL BANP.BK, expects to sell 20.5 million tonnes of coal this year, up from 17.8 million tonnes in 2008.

Indo Tambangraya sold 4.1 million tonnes of coal in the January to March period this year, down from 4.4 million tonnes in the same period in 2008.

Despite lower sales volume, the coal price the company achieved rose 70 percent to an average of $85 a tonne in the January-March period, up from $50 a tonne in the same period of 2008.

Sales revenue was $347 million in the first quarter of 2009, up 59 percent from $219 million in the same period last year.

Indo Tambangraya has forecast revenue would climb to between $1.33-$1.54 billion this year, compared with $1.32 billion in 2008, on higher production.

Indo Tambangraya owns shares in several Indonesian coal miners including PT Trubaindo Coal Mining, PT Indominco Mandiri, PT Kitadin, PT Jorong Barutama Greston and PT Bharinto Ekatama.

Source: Reuters