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Bayan signs $300m mining deal with Petrosea
PT Bayan Resources, the country's eighth largest coal producer, has signed a US$300 million mining contract with construction firm PT Petrosea
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PT Bayan Resources, the country's eighth largest coal producer, has signed a US$300 million mining contract with construction firm PT Petrosea.
PT. Gunungbayan Pratamacoal (GBP), a subsidiary of Bayan, signed a 5-year contract with Petrosea for overburden removal, Bayan director Jenny Quantero said in a statement over the weekend.
Overburden is the term used in mining to describe the rock and soil that lies above the coal seam.
Petrosea has been operating at GBP from November 1999 under two contracts, the last of which is due to expire at the end of December 2008.
The new deal, which will commence on Jan. 1, 2009, sets the overburden production targets of 36 million bank cubic meters (BCM) per annum.
"We believe that our strong relationship and support from Petrosea will positively contribute to our activities and secure future production from one of our main mines," Bayan's president director Eddie Chin said.
GBP is a coal mining company that has a second generation coal contract of work (CCOW) to mine in Muara Pahu, East Kalimantan. It is split into two separate blocks with a total concession area of 24,066 hectares.
Bayan was the eighth largest coal producer in Indonesia in terms of production volume in 2007. Through its eight subsidiaries, it owns the rights to mine coal on a total area of 81,265 hectares in East and South Kalimantan.
Bayan produces wide coal with a variety of caloric values. It expects to increase its coal production to 9 million tons this year from 4.7 million tons last year.
Bayan's 2008 projected sales volume is 9.9 millions tons, up from 7.1 million tons last year.
The company estimates a doubling of revenue to $700 million this year, from $376 million last year. Net profit is expected to reach $100 million this year, more than triple last year's of $27.5 million.
