PT BA seeks to solve problems at Suralaya

Fitri Wulandari, Jakarta

Publicly listed state coal miner PT Tambang Batubara Bukit Asam (PT BA) plans to buy up to 250,000 tons of coal to increase supplies for the Suralaya power plant in West Java, which is now facing a coal shortage.

Company operations director Sukrisno said the company was still negotiating with a coal producer in Kalimantan, which he declined to identify, on the purchase plan, and hoped it could deliver coal from June to December.

"It's still not sufficient for Suralaya, but at least it can reduce the shortage," Sukrisno said on the sidelines of a hearing on Wednesday with House of Representatives Commission VIII, which oversees energy and mining issues.

With the additional supplies, PT BA is expected to supply a total of 5.6 million (m) tons to Suralaya this year, but under the contract with public utility PT Indonesia Power, the owner of Suralaya, it has to supply 7.3m tons per annum to the power plant.

Coal supply to Suralaya has declined over the past few months, as a collapsed bridge has hampered coal delivery from PT BA's Tanjung Enim mine site, South Sumatra, to Tarahan port, Lampung.

A reduced coal supply caused Suralaya, whose capacity of 3,400 megawatts makes it the largest power plant in Java, to supply less electricity to the Java-Bali power grid last month.

Elsewhere, PT BA president Ismeth Harmaini said the company was now in talks to acquire a coal mine in Kalimantan to increase its production by 2 million to 3 million tons.

"We can supply the new production capacity to Suralaya and other buyers," Ismeth said.

He declined to name the company that owns the coal mine but said PT BA had made ready some US$50 million to finance the acquisition plan.

The company produced 10.03m tons of coal in 2003, less than half of its annual capacity of 22m tons. It has revised downward its output target for this year from 10.2m tons to 9.3m tons due to the unresolved transportation problems.

The firm proposes to form a consortium with PT Indonesia Power and state railway company PT KAI to improve and upgrade the railway network.

PT BA proposes to raise the capacity of coal trains to 12.5m tons per year from Tanjung Enim to Tarahan and 2.5m tons from Tanjung Enim to Kertapati port in Palembang in 2007. The project is estimated to cost around Rp 1.7 trillion.