Borneo to supply 500,000 tons of coking coal to Krakatau Posco

By Hiski Darmayana

IDX-listed coking coal producer PT Borneo Lumbung Energi & Metal Tbk said it plans to supply 500,000 tons of coking coal to steel maker Krakatau Posco (KP) in 2014. KP is a joint venture between Indonesia?s state owned steel maker PT Krakatau Steel and South Korea?s Posco.

?The 500,000 tons coking coal will be used by them for steel production at a planned initial capacity of 3 million tons per year,? Borneo Finance Director Ken Allan told Petromindo.com Wednesday.

Allan said that his company was finalizing the sales and purchase agreement with KP. ?In the second year, we?ll deliver higher volume of 1 million tons to KP,? he added.

Borneo, which has a 21,600-ha concession in Murung Raya, Central Kalimantan, this year aims to produce 4.5 million tons coking coal. As of the first semester, realized output was 1.9 million tons. ?Our largest market remains China,? Allan said.

Editing by Reiner Simanjuntak