PT Bumi Resources Tbk (BUMI) has obtained the approval of the Work Plan and Cost Budget application from the Ministry of Energy and Mineral Resources (MEMR). In this case, BUMI has a Special Mining Business License for PT Kaltim Prima Coal and PT Arutmin Indonesia for the period 2024 to 2026.
Director and Corporate Secretary of BUMI, Dileep Srivastava is optimistic that the company can pursue the coal production target of 80 million tons in 2024.
"There are no official figures yet, but it is estimated that it could reach around 80 million tons. Production is higher than in 2023. Hopefully, the price can be higher. Most of them depend on geopolitics, economy, weather, and market dynamics," BUMI Director and Corporate Secretary Dileep Srivastava told CNBC Indonesia, Tuesday (2/1/2024).
For information, the Ministry of Energy and Mineral Resources has officially issued new regulations regarding procedures for drafting, submitting, and approving Work Plan in the mineral and coal mining sector. This regulation is contained in the Regulation of the Minister of Energy and Mineral Resources Number 10 of 2023.
At least, there are some important points contained in this regulation. These include the distribution of activity time for Work Plan, administrative sanctions, fulfillment of essential aspects in the preparation of Work Plan and efficiency of time management.
Previously, Dileep also emphasized that there are several challenges that must be faced by the coal industry. Fluctuations in coal prices and bad weather are one of the things to watch until the end of the year.
According to him, the commodity cycle that makes coal price fluctuations must be watched out for because it is unpredictable.
Several factors can affect prices, such as the flash floods that hit China last week.
This condition caused disruption to the coal delivery railway line in Jingxing county. The distribution disruption raises concerns that coal supply will fall sharply so that the price rises. Another challenge is soaring fuel prices which are considered to increase the company's operational cost component. The regulation regarding deposits of 30% of export income for 3 months effective from August 1, 2023 is also a matter of scrutiny.
Efficiency, digitalization, downstream coal, and non-coal diversification are also included as challenges in pursuing coal production targets in 2023.
"Time, market, and regulatory factors will play a role in market perception and outcomes. Of course, BUMI is the only debt-free company with strong equity partners, namely Bakrie, Salim & CIC, and others. Being debt-free in the current geo-eco-political environment puts BUMI at a comparative advantage," concluded Dileep.
Image source: CNBC Indonesia/Firda Dwi Muliawati
Source: www.cnbcindonesia.com/Dapat Restu RKAB, Produksi Batu Bara BUMI Bisa Capai Segini
