Coal output to reach 150 million tons in 2005
Fabiola Desy Unidjaja, The Jakarta Post, Jakarta
With demand from domestic and overseas markets on the rise, the country's oil output for 2005 is expected increase by 18 percent from last year, to 150 million tons.
Of that total, some 70 percent would be exported, Ministry of Energy and Mineral Resources official Mahyudin Lubis said on Thursday.
"Most coal mining firms here are increasing their production capacity for this year and boosting the output to 150 million tons -- from 127 million tons in 2004," Mahyudin said.
An example was PT Kaltim Prima Coal (KPC), the nation's largest coal producer, which he said would boost its output to up to 25 million tons from 22 tons recorded in 2004 with the average price of US$50 a ton.
"KPC's coal price is actually above the average, and not all coal has the quality of KPC's, which can be sold at about $20 to $25 per ton," he said.
Aside from KPC, another coal mining firm PT Adaro is predicted to meet its production target of 28 million tons this year, making it the second-largest coal producer in Indonesia.
Indonesia's coal industry is expected to substantially grow with the government planning to construct and develop nine more coal-fired power plants by 2009 to safeguard the country's power supplies.
The first of such projects, located in Banten province, will be put onto an open tender in March.
The increasing domestic demand is also in line with the upward trend in overseas demand, with Japan and China -- among the world's largest coal importers -- having shown interest in increasing their coal import from Indonesia.
Japan-based Chubu Electric Power Co. Ltd. has said that it would gradually boost coal imports from Indonesia.
Mahyudin estimated that demand from Japan could rise by about 5 percent this year.
"Currently, Japan is the largest importer of our coal, along with South Korea, India and Malaysia," he said.
Meanwhile, PT Aneka Tambang, a gold and nickel mining company which is 65 percent owned by the government, expects nickel output to rise by 28 percent this year.
Production may rise to 10,150 metric tons from 7,945 tons last year, the company Corporate Secretary Ashur Wasif said in a statement as quoted by Bloomberg.
Base metal prices soared during the past year as economic growth in China and the U.S. spurred demand and drained stockpiles, helping boost earnings of Aneka Tambang and other miners. Prices of nickel, a material for stainless steel, has risen by 12 percent in the past 12 months and with gold having risen by more than 7 percent.