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Friday, 03 December 10
INDONESIAN LOW RANK COAL IS ATTRACTING COAL BUYERS FROM INDIA AND CHINA


COALspot.com - Bhakti Energi Persada has sold out its whole coal production until the end of 2011, Jeffry Mulyono  said during McCloskey Asia Pacific Coal Outlook Conference 2010, which was held in the island of Bali during 1 - 2 December 2010. Mr. Jeffry, the president director of Bhakti Energi Persada further said, Low rank coal of Indonesia was already attracting end-users from China and India.

Bhakti began producing low rank coal from its mine in Muara Wahau region, East Kalimantan since 2009.  2010 productions have reached to 0.7 mln tons and around 1.5 million tons will be produced by next year. Bhakti Energi's coal deposit is one of the largest compare to other coal mines in Indonesia. According to Jeffry Mulyono, Bhakti has coal reserves of 5.7 billion tonnes, and it will last for several decades. MEC, a Dubai based energy company is also having the coal concession in Muara wahau region and claimed the coal deposit is more than 1 billion tons.  MEC in the process to build railway lines to transport the coal to its coal terminal which is also in plan to build to load panamax to cape size vessels.

Jeffry told during his presentation, the company also studying coal drying or CUB to upgrade part of its production. According to him a unit of UCB  plant can upgrade about 1 million tons of coal per annum. Part of upgraded coal also could be blended with non upgraded coal to fulfill buyer's requirements.

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The cost of upgrading coal of Bhakti is estimated at $ 9 per ton, excluding capital expenditure, Jeffry replied for a question from the floor. Indonesian government may provide additional incentives for low rank coal producers, and it may allow miners to sell low-rank coal below Indonesian coal price reference.  Other miners are required to sell their coal higher or equal to government declared coal price reference. 

Government has declared US$ 23.60 per MT for 2,995 GAR coal in November. Meantime, Government has fixed US$ 102.86 for 7000 GAR coal for the same month. Indonesian coal price for November was US$ 95.51 per MT basis 6,322 GAR .

The reference price for December is expected to increase, as the international indices which were used to calculate Indonesian coal price reference are seeming to be high during November compared to end of October 2010.
(cs)



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