The Director of PT TBS Energi Utama Tbk. (TOBA), Juli Oktarina, confirmed that the operations of the company's three coal mines will cease by 2027 at the latest. This closure is due to the depletion of the mines' reserves (fully mined out) and is part of TBS's strategic move to achieve its Carbon Neutrality target by 2030.
"The reserves are already depleted, and we do not have new mines yet. That’s why we are confident that by 2027, all operations will cease. However, the timing won't be the same for all of them. Some will be fully mined out by 2025, others by 2026, and the last one by 2027. So, all three mines will be fully mined out by 2027," explained Juli.
The three coal mines are PT Adimitra Baratama Nusantara (ABN), PT Trisensa Mineral Utama (TMU), and PT Indomining (IM).
Juli acknowledged that the closure of these mines will impact the company’s cash flow, especially since the majority of revenue is still reliant on the mining business. However, due to the company's commitment to reducing carbon emissions, TBS is transitioning its business toward green energy in the future.
This shift to a green business model will require significant investment, particularly in infrastructure development. At the Extraordinary General Meeting (EGM) held in Jakarta on Thursday, November 14, 2024, independent shareholders approved the divestment of two coal-fired power plant (PLTU) assets, each with a capacity of 200 MW, operated by subsidiaries PT Minahasa Cahaya Lestari (MCL) and PT Gorontalo Listrik Perdana (GLP).
Juli mentioned that the company has found a buyer, PT Kalibiru Sulawesi Abadi (KSA), for a transaction value of USD 144.8 million, which is higher than the company’s initial investment of USD 87.4 million.
This move will help offset the EBITDA loss from the coal power plants and allow the company to reinvest in its green energy initiatives, aligning with its sustainability goals.
"Strategically, we want to recycle the earnings from our mining business and the coal power plant business into three key segments: renewable energy, electric vehicles, and waste management. The corporate actions we are taking, including this divestment, are crucial steps in executing the strategy we communicated several years ago," Juli concluded.
