Indonesia coal firms lease Singaporean vessels

Indonesia coal firms lease Singaporean vessels

Fadli, The Jakarta Post, Singapore

Two specially designed coal carriers ordered by two Indonesian
coal producers, South Kalimantan-based Banpu Public Company Ltd.
and PT Arutmin Indonesia, have sailed from Jurong in Singapore
for Kalimantan.

The vessels -- a Kimtrans Self Propelled Barge (SPB) 3208 and
a Kimtrans Self Discharging Barge (SDB) 3203 -- were ordered from
Singaporean integrated logistics provider Sembawang Kimtrans Ltd.
(SKL) to help boost the volume of coal shipments from the two
firms in the face of rising demand.

Arutmin's port assistant manager Budiono said the company had
decided to lease the coal carriers from SKL due to the more
up-to-date technology they employed compared to conventional
barges.

"These vessels cannot as yet be built locally. It's not that
we don't want to rent barges from local firms, but we consider
these to be more efficient, and they also have various advanced
features," said Budiono.

Arutmin contributes one-sixth of the country's total coal
exports. The company is presently capable of producing 14 million
tons of coal annually and requires the services of four coal
carriers.

"We have a production target of 18 million tons of coal a year
and thus will require additional coal carriers for shipments in
the near future," said Budiono.

Senior Vice President of Banpu Public Company, Philip Gasteen,
expressed a similar view to Budiono. He said that his company was
looking forward to trying out SKF vessels.

"We want to test the prototype they have offered us. If there
are Indonesian companies able to show us better designs and
technology, we will definitely give them a chance, taking into
consideration the economics involved," said Gasteen.

Sembawang Kimtrans Ltd. Chief Executive Officer Peter Tan told
The Jakarta Post that apart from their special designs, the
vessels employed more advanced technology was than ordinary coal
carriers.

Better still, both the SPB 3208 and SDB 3203 were specially
designed for Indonesian waters. "The SPB 3208 is highly
maneuverable and change direction in a full circle. It is
specially designed to navigate the Mahakam and Barito rivers,
which have very narrow channels," said Peter.

SKL country manager for Indonesia, Riatna Jeo, said the
company was very interested in the Indonesian market, as
evidenced by the fact that currently around 50 percent of its
market consisted of firms based in Indonesia.

"The transportation services industry in Indonesia still lacks
capital and technology compared to overseas firms, and
accordingly SKL has many advantages here," said Riatna.

Riatna said that both companies had signed four-year leases
for the vessels. However, SKL declined to specify the value of
the leases.

It cost US$8 million to build each vessel, with construction
taking nine months.

The Kimtrans SPB 3208 is different from a conventional barge
towed by tugboats. The 95.34-meter-long vessel, weighing 9,000
tons, is capable of transporting 1 million tons of coal per year.

The vessel can easily navigate the Mahakam river, with a depth
of only 1.3 meters. The ship is being leased by Banpu Public
Company Ltd., which operates a number of coal mines in South
Kalimantan.

The Kimtrans SDB 3203 is specially designed to transport coal
by docking and discharging its load to larger vessels for export
or to carry coal from river docks directly to coal exporting
harbors. Its length is 93.35 meters and it weighs 8,800 tons.