Jan 13, 2011

Krakatau Steel, Borneo in talks for coal

The state-owned steel maker PT Krakatau Steel Tbk (KRAS) and Posco are in talks with several coking coal producers, including the newly listed PT Borneo Lumbung Energi & Metal Tbk (BORN), to secure coking coal supply of approximately 2 million tons in 2012.
Irvan Kamal Hakim, Marketing Director of Krakatau Steel, said Borneo Energi is one of potential suppliers for new steel plant which is now under construction with Posco.
"Principally, we are in talks with any potential coking coal suppliers to secure the supply in 2012 because we need coking coal in steel processing," he said.     
The project is expected to be accomplished in 2012. The joint venture between Krakatau Steel and Posco will require 2 million tons coking coal.
When asked about the possibility to acquire coking coal miner, Irvan said if the company has an opportunity, it might consider the option. "We are striving to have sufficient iron ore and coking coal supplies," he said.
Hard coking coal producer Borneo Energi indicated to post 1.65 million tons sales volume with average selling price of US$185 million per ton by end of last year.
Referring to the indicators, Borneo Energi is estimated to post US$305.25 million revenue or Rp2.76 trillion in 2010. In a morning note released by PT Mandiri Sekuritas today, Borneo Energi also indicated to produce 1.95 million tons coking coal in 2010.

Disclosure: No position at the stock mentioned above.  

Print This Article

No comments: