PTBA to acquire mining firms

PTBA to acquire mining firms

Abdul Khalik, The Jakarta Post, Jakarta

State-owned PT Tambang Batubara Bukit Asam, the country's fifth largest coal mining company, will start the process of acquiring four other coal mining companies in Kalimantan over the next two months while simultaneously pushing ahead with its plan to build power plants in Sumatra.

The company has had teams performing due diligence on the acquisition plans since last month. The teams are expected to complete their studies before the end of the first semester.

"We can't name the four companies yet as we must wait until the studies are completed. However, two companies are located in South Kalimantan and the other two are in East Kalimantan," said the president of the publicly-listed company, Ismet Harmaini, on the sidelines of the company's shareholders' meeting on Tuesday.

He added that the cost of the acquisitions would not be known for two more months, but stressed that it would be financed internally by the company.

"There will be no bond or rights issues for the project. We can finance this ourselves as we have idle funds totaling US$50 million," said Ismet.

The company is also pushing ahead with its plan to jointly build a 2 x 100 megawatt coal-fired power plant with PT Indonesia Power in Banjarsari, South Sumatera, and another coal-fired power plant with the same company in Pranap, Riau, which will have a capacity of 2 x 250 megawatts.

The two plants will cost a total of US$700 million, and Bukit Asam will have 24 percent of the total shares.

"Both of these plants will (also) be financed by internally," said Ismet.

He added that this year's sales revenue was projected to reach Rp 2.4 trillion (US$287 million), up from Rp 2.28 trillion last year. The company's profit for 2004 would be around 5 percent to 6 percent of revenue due to the higher coal prices and higher coal volumes sold, he said.

Elsewhere, the company decided at the meeting to replace its chief commissioner, Simas Sembiring, with Yarman, and add two new commissioners, Singgih Rupat and Supriyadi.

Bukit Asam has coal deposits of 7.3 billion tons, or 17 percent of the country's total deposits, and has reserves of 1.5 billion tons.

The government owns 83.7 percent of Bukit Asam's total shares, with the remaining 16.3 percent owned by the investing public.