Indonesia’s coal production growth will slow as the global credit crisis hampers expansion plans by the world’s biggest exporter of the fuel, Fitch Ratings said.
“Companies that have not secured long-term funding will likely have to cut back’’ on their spending, the ratings company said in a report on Friday. “This, together with the fall in economically mineable reserves given the fall in coal prices, may result in slower production growth in the future.’’
The worst financial crisis since the Great Depression is forcing Indonesian coal producers, including PT Adaro Energy, to review expansion plans. Thermal coal prices have halved from a record $194.79 a metric ton in July as crude prices slid on lower demand.
Fitch said the growth rate in 2008 would be further hindered by a global shortage of mining equipment.
Adaro, which owns Indonesia’s second largest coal producer, is reviewing output plans for 2011 and beyond. The company had planned to double annual production capacity to 80 million tons in five years.