Berau Coal Plans to Increase Production to Meet Rising Demand From India

PT Berau Coal expects to produce 17 million metric tons of thermal coal this year and may increase its output to 30 million tons in 2014 because of rising demand from India, a company official said.

“I’m bullish on coal prices because of the Indian factor,” Bob Kamandanu, a commissioner at the Indonesian mining company, said today in Bali, Indonesia. “New IPPs are starting in India in 2011 and 2012.”

India, Asia’s largest economy after Japan and China, expanded 8.6 percent in the three months ended March 31 from a year earlier, boosting its consumption of electricity as factories stepped up production. India is a steady buyer of the fuel compared with China, which substitutes imports with domestic output when prices rise, Kamandanu said.

Berau’s mineable reserves have increased to about 500 million tons from 177 million tons in 2006, Kamandanu said.

The company is one of the five largest coal producers in Indonesia. Its coal production area is in the northern part of the East Kalimantan region.

To contact the reporters on this story: Yoga Rusmana in Jakarta at yrusmana@bloomberg.net; Dinakar Sethuraman in Singapore at dinakar@bloomberg.net.

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