ABM Subsidiary Bags Mining Service Initial Contract Worth US$ 206 Million
Cipta Kridatama secures mining services contract until the expiration of the life of mine
Jakarta, September 9, 2013 – PT ABM Investama Tbk. (IDX: ABMM) through subsidiary PT Cipta Kridatama (CK) signed a five-year contract with PT Multi Harapan Utama (MHU) with an option to extend the contract until the expiration of the life of mine. The initial five-year contract for two mining pits worth US$206 million was signed by Yovie Priadi, President Director of PT Cipta Kridatama and Boedi Santoso, President Director of PT Multi Harapan Utama and Achmad Zuhraidi, Director of PT Multi Harapan Utama on Monday, September 9, 2013.
MHU is a coal mining company that holds a 1st generation Coal Contract of Work (CCOW), though this was changed to Number 56.K/30/DJB/2008, dated March 31, 2008. MHU also operates with other licenses, including Forestry and Land Use Permit (IPPKH).
“The contract signing is a breath of fresh air we have been anticipating as it will last for as long as the mining concession. The value of the initial contract for this two mining pits spans over five years and we will be reviewing the extension together,” Yovie said.
The contract stipulates that CK will provide mining services such as overburden removal, coal distribution, coal hauling, rental of heavy equipment, and the infrastructure maintenance for two coal mining pits of MHU that are located in Tanjung Laung and Loa Kulu, Kutai Kertanegara, East Kalimantan.
MHU mining sites produce multi-rank coal and are home to massive coal reserves. The contract targets 107 million bcm in overburden removal for the first 5 years and seeks coal production to reach 9 million metric tons. Coal output will be marketed locally and exported to several countries across Asia.
Yovie added, “The cooperation between the MHU and CK is an achievement for business development of both companies. Armed with MHU’s new management’s decades of experience in the industry, as well as CK's commitment to provide the best services for its business partners, we are optimistic that this partnership will bring added value to both companies."