Pamapersada gets US$250 coal mining deal

Pamapersada gets US$250 coal mining deal

JAKARTA (JP): PT Indominco Mandiri has awarded a contract worth US$250 million to PT Pamapersada Nusantara to mine and transport 13.7 million tons of coal in Bontang, East Kalimantan.

The companies said in a joint statement here yesterday that the contract was signed in Jakarta on May 30,

Indominco Mandiri will invest $160 million in the coal mining project which will be financed by private placement of convertible bonds and long-term overseas loans from Japanese banks.

Indominco Mandiri is 65 percent owned by PT Indo Tambangraya Megah and 35 percent by PT Indocement Tunggal Prakarsa, a major cement producer.

"The 5.5-year contract includes the transportation of coal to a nearby seaport, some 35 kilometers south of Bontang, to supply Indocement's plant in Bogor, West Java," the statement said.

The coal reserves in the 25,000-hectare concession area of Indominco Mandiri are estimated at some 70 million tons, which can be mined for 20 years, with an annual production rate of 3.5 million tons. The mine will start producing steaming coal in 1999.

"Some 1.5 million tons of the coal will be consumed by Indocement, while the rest will be exported," said the statement.

The contractor, Pamapersada Nusantara, is a subsidiary of PT United Tractors, which produces heavy equipment.

Prior to this contract, Pamapersada Nusantara was granted another contract by PT Adaro to mine and transport some 50 million tons of coal in South Kalimantan.

The South Kalimantan coal project will start production in 1998 to supply a steam power plant in Paiton, East Java. (kod)