Indonesian coal producer Baramulti Suksessarana (BSSR) has set a lower production target this year, saying it will focus on boosting operational efficiency at its mines in response to a recent decline in coal prices.
BSSR aims to produce 18mn t this year based on its work plan and budget approved by Indonesia's energy ministry. This is a 16pc decline from its 2023 output. It expects its coal sales to reach just over 18mn t this year, with the additional volume coming from coal stockpiled from last year's production.
BSSR has earmarked $81mn for capital expenditure this year, most of which will be used for mining and infrastructure development, as well as heavy equipment renewals as part of the company's plan to further develop its coal mine in Samarinda in east Kalimantan, it said.
The mine in Samarinda accounted for 26pc of the company's total output in 2023. The mine is in close proximity to Samarinda city which limits the maximum allowable mining area, prompting BSSR to develop the mine up to its allowable limit without expanding the work area, the company said. BSSR also has a coal mine in south Kalimantan which accounts for the remaining 74pc of its production.
The company produces GAR 3,400-4,100kcal/kg coal from its two mines. BSSR said that its coal is usually used for blending purposes by consumers. China is the company's largest market, accounting for 54.47pc of its total sales in 2023. India and South Korea are second and third, making up 14pc and 4.63pc of the remaining sales volume respectively. Local sales made up 21.89pc in 2023.
BSSR did not rule out the possibility of increasing its production in the second half of the year as it has the capability to do so. But the company saidthat it will do so only if coal prices increase for the remainder of the year.
Prices of Indonesian GAR 4,200 kcal/kg coal were last assessed by Argus at $53.83/t fob Kalimantan on 21 June, down from a 2023 peak of $90.41/t reached in January last year.
