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Coal far from ‘dead’: prices to remain high, IPO still lucrative
Coal will still become one of Indonesia’s key growth drivers in years to come, despite a steady shift to renewable energy, as the ‘black gold’ commodity prices are poised to remain elevated due to robust demand amid supply disruptions.
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Europe is flocking to Indonesia as coal has become a valued commodity after Russia cut off gas supplies.
T
he coal-mining sector will likely still be one of Indonesia’s key-growth drivers in years to come, despite the country’s steady shift to renewable energy, as the “black gold” commodity prices are poised to remain elevated due to robust demand and persistent supply disruptions.
Furthermore, high coal prices have led to a positive prospect for companies who are set to launch initial public offerings (IPO) in the second half of this year, such as PT Black Diamond Resources, which began offering its shares on Aug. 12.
Indonesian Coal Mining Association (APBI) executive director Hendra Sinadia said that, through the world’s largest financiers of coal-energy projects, such as China, Japan and South Korea, have vowed to stop funding new coal-fired power plants overseas, existing coal plants still need to operate for years to come.
He expected demand for coal to remain strong for at least the next 10 years.
“Considering the high coal price, this is the right time for coal-mining companies to launch IPOs,” he told The Jakarta Post on Tuesday.
Read also: Coalminer Black Diamond Resources seeks up to $15.5 million from IPO
Indonesia’s benchmark coal price (HBA) hit US$323.9 per metric ton in June, the highest since the Energy and Mineral Resources Ministry first recorded its HBA in 2009, the ministry’s data show.
