Indonesia provides a geographical advantage in the logistical movements of coal and is located in the same region to global demand, such as Japan, Korea, China and India. The freight cost advantage combined with Indonesia’s comparative advantage in low operating and extraction costs, means sustainable coal supply even at low global prices. Typically, coal mining and extraction costs are around 50% in comparison to typical Australian coal mining and extraction costs.
Indonesia holds nearly a third of the world’s coal resources. Over half of Indonesia’s coal resources are located in Kalimantan (Formerly Borneo) and a significant amount of coal resource is located on the island of Sumatera. Kalimantan coal resources are located in significant quantities in Southern and Eastern Kalimantan. Significant coal resources are also available in Central Kalimantan; however the logistical costs of transporting commercial quantities from that region do not support justification for a commercial operation. Therefore, Enegra is focused on Southern and Eastern Kalimantan.
Indonesian coal exports in 2011 totaled 134 Million Metric Tons Per Annum (MMTPA). Of this 40 MMTPA were sourced from East Kalimantan, 68 MMTPA was sourced from South Kalimantan, 240 KMTPA was sourced from Benkulu, 1.4 MMTPA was sourced from Riau and a further 12.4 MMTPA was sourced from South Sumatra. The remaining 10-11 MMTPA was sourced from various small-scale miners and non-significant coal producing areas. (Source: Indonesian Coal Association Statistician).
ENEGRA is currently negotiating an off take agreement with a traditional local gold mining group in Indonesia. Further information on this will be posted on this web site once negotiations are finalized, and gold off take trading has commenced.