Postpone the power project, MYOH prepares a new acquisition

JAKARTA. PT Samindo Resources Tbk (MYOH) prepares to search for coal mines to be acquired in the second half of the year. Ahmad Zaki Natsir, MYOH Investor Relation, said that currently there are three mines being explored by the company.

He explained that MYOH is preparing US $ 100 million for the acquisition plan. This funding will be obtained from internal cash and external loans. MYOH prioritizes medium-calorie coal mines in East Kalimantan.

MYOH is indeed doing a number of business diversification to strengthen its performance. In addition to exploring the coal mining business line, the mining services company is also aiming for power projects.

However, Zaki said that the plan to expand the electricity project seems to have to be postponed. This is because the tender for power projects by the State Electricity Company (PLN) targeted by MYOH is over. "So this year, there is no new tender that we will follow," he said to KONTAN, not long ago.

He said the expansion of electricity projects will still be done for the long term. MYOH has prepared funding of approximately US $ 25 million to get a share of equity in the participation of power plant projects. The company is eyeing the 200 MW-500 MW power plant projects, located near the company's base of operations.

MYOH also retains revenue from its core business in mining services. Not long ago, MYOH got a new contract with one of subsidiaries of PT Bayan Resources Tbk (BYAN).

From the new contract, MYOH has an opportunity to obtain an additional 2.7 million bcm of overburden volume by the end of 2017. In the contracts valid until 2019, MYOH will get an additional 6 million bcm of overburden annually. But that number can not be fully realized in this year, because the new project will begin in mid-year.

Previously, MYOH target overburden could rise to 50.7 million bcm, or an increase of 5.6% compared to production in 2016.

Until last May, the total overburden produced has reached 19.4 million bcm or 40% of the target. Therefore, MYOH will start buying equipment to increase its production. "Funds for equipment spending is estimated at US $ 10 million," said Zaki.