PT Harum Energy Tbk (HRUM) reported the absorption of a total capital expenditure alias capital expenditure of US$ 12.9 million in the first six months of 2023. This capex is used for a number of HRUM subsidiary needs, namely the addition of mining properties at PT Mahakam Sumber Jaya, PT Karya Usaha Pertiwi, and PT Tanito Harum Nickel

Capex is also used for the cost of maintaining the barge fleet owned by PT Layar Lintas Jaya as well as the purchase of vehicles and heavy equipment.

HRUM Main Director Ray Antonio Gunara said, his party still maintains the estimated capital expenditure budget for 2023, which is around US$ 52 million. Most of the capex will be used for the construction of infrastructure and production facilities in the nickel mining area. 

"While the rest is for additional coal mining properties, purchase of vehicles, purchase of heavy equipment and maintenance of tugboats and barges," Ray told Kontan.co.id, Wednesday (2/8).

HRUM decided to raise its coal production target this year in line with the high operational performance throughout the first half of 2023.

The issuer owned by tycoon Kiki Barki revised HRUM's coal production for 2023 to 6 million tons, or around 20% higher than the previous year. Previously, HRUM had set a production target of 5.5 million tonnes by the end of 2023.

As an illustration, HRUM managed to produce 3.5 million tons of coal during the first six months of 2023. This amount is equivalent to a 49.1% increase from actual production in the same period the previous year which was only 2.3 million tons.

Thus, as of the first half of 2023, HRUM has met 58.3% of the set production target.

Meanwhile in the nickel segment, the second HRUM smelter, owned by its associated company, PT Westrong Metal Industry (WMI), is currently in the final stages of construction.

As previously announced, WMI will have four rotary kiln electric furnace (RKEF) smelter lines designed to produce up to 56,000 tons of nickel metal annually in the form of high-grade nickel pig iron (NPI) and matte nickel.

By June 2023, civil construction progress at WMI had reached nearly 90%, and the smelter is expected to start commercial production in stages from the fourth quarter of 2023.

This will support the sustainable growth of HRUM's nickel production going forward. With the flexibility to produce high grade matte nickel, WMI expects to generate stronger margins than low grade NPI production.

Image source: Dok/HRUM

Source: https://stocksetup.kontan.co.id/news/hingga-semester-i-harum-energy-hrum-sudah-serap-capex-us-129-juta