PT Bukit Asam to raise coal output

JAKARTA (JP): The state-owned coal mining company PT Tambang Batubara Bukit Asam has said it plans to raise its coal output to 12.1 million tons this year from 10.1 million tons last year.

Company president R.A. Sunardi said late on Monday that last year the company had to curtail output to 10.1 million tons after originally planning to extract 11.8 million tons because of sluggish demand in both foreign and domestic markets.

"The Suralaya power plant, which was expected to use eight million tons of our coal last year, only required 6.9 million tons," Sunardi said at a gathering to break the fast.

The Suralaya power plant in West Java is owned by state electricity company PT Perusahaan Listrik Negara (PLN).

Bukit Asam sells 70 percent of its coal to Suralaya and exports the rest to overseas markets, including Malaysia, Thailand and the Philippines.

Sunardi also said that Bukit Asam coal exports decreased to 1.71 million tons last year from 1.87 million tons in 1997 as a result of the regional economic crisis.

Sunardi said Bukit Asam had now turned its attention to new overseas markets which were less affected by the regional recession, including Taiwan, Europe, the United States and Turkey.

Sunardi refused to disclose the company's 1998 profits, but said that last year the company paid a total of Rp 298.27 billion to the government in taxes, royalties and dividends, an increase on the Rp 144.2 billion paid in 1997. This year, he said, the company expects to pay Rp 309.26 billion in taxes, royalties and dividends.

Sunardi said that Bukit Asam was seeking to raise the price of coal it sells to the Suralaya power plant to Rp 167,000 per ton. The current price, Rp 93,000, is below the production cost, he explained.

"We also need to raise the price we sell coal for because the government has said that we are going to be privatized.

"Investors will value the company below its true value if we continue to sell coal to Suralaya at the current price," he added.

Bukit Asam is one of a number of state-owned companies that the government has said it will privatize during the coming fiscal year to raise funds to finance the budget deficit.

Sunardi said that Bukit Asam plans to reduce sales to the Suralaya power plant by 20 percent to allow it to increase exports.

He also said Bukit Asam was planning closer cooperation with state railway company Perumka to increase the capacity of the rail link between Bukit Asam's mine in Tanjung Enim, South Sumatra, with Lampung's Tarahan port. (jsk)