Banpu plans US$15-20m for coal investment in 2001

Banpu plans US$15-20m for coal investment in 2001

BANGKOK (AFX-ASIA): Banpu Plc chief executive officer Chanin
Vongkusolkit said the company plans to spend US$15-20 million on
investment next year, mainly on new coal mines in Indonesia.

"The money will be utilized for investment in our coal
business in Indonesia and the investment is aimed at seeking new
sources of coal," Chanin told AFX-ASIA in an interview.

He said funding of the new investment will be partly from cash
on hand and partly from cashflow.

Chanin said the coal industry in Asia is expected to continue
to growth at a rate of 5-10 percent per annum next year.

Currently, capacity at Banpu's coal operation in Indonesia
runs at 3.0 million tons a year "but we have no plan to boost
capacity there from current levels," he said.

Chanin said some 40 percent is exported to Thailand while 20
percent is sold in Indonesia and the balance of 40 percent
shipped to other countries.

He said the company aims to be a regional coal company in
order to diversify risks.

Banpu recently bought a 10 percent stake in Lanna Lignite Plc
in order to add value to the company and "because Lanna Lignite
has better quality coal in terms of higher heat values," he said.

Lanna Lignite produces 1.0 million tons of coal per year and
it will commence operation at its new source in Indonesia next
year, he said.

"The investment in Lanna Lignite is for the long-term.
However, Banpu has no plan to increase our holding in Lanna," he
added.

Banpu has also bought a stake of some 8.0 percent in recently
listed Ratchaburi Electricity Generating Holding Plc, which is
also for the longer term.

"We view Ratchaburi as adding value and creating synergy for
the company. Furthermore, the risks on any investment in
Ratchaburi are very low because its plants are cost-effective and
have economies of scale," he said.

In terms of assets, Banpu's investment in both the power
generation business and coal business are about equal and will
probably remain so for some time, he said.