Wed Feb 16, 2011 11:56am GMT
JAKARTA Feb 16 (Reuters) - Indonesia may regulate the price of coal sold to state utility firm PT Perusahaan Listrik Negara (PLN) if negotiations between the company and several coal producers fail to reach an agreement, the energy ministry told lawmakers in a report.
The ministry said that since November PLN has faced problems from coal suppliers asking for higher prices due to the increasing world prices caused by extreme cold weather and floods in Australia.
PLN has been negotiating prices with six companies and it expects to complete the talks by the end of this month. According to the ministry, PLN has not yet reached an agreement with PT Tambang Batubara Bukit Asam and Kaltim Prima Coal, a unit of top miner Bumi Resources .
"If agreement cannot be reached between PLN and these suppliers, we will recommend to issue a ministerial decree which will determine prices of coal sold to PLN," the ministry said in the report.
The ministry said the price would refer to the existing coal price benchmark issued monthly by the ministry, and would limit the increase in PLN's coal costs to not more than 2.13 trillion rupiah ($238.9 million) for this year.
PLN, the biggest domestic consumer of coal, estimates its coal-fired power plants will burn 52 million tonnes this year, up from 36 million tonnes in 2010.
For the monthly coal price benchmark in the world's largest exporter of thermal coal see . ($1 = 8914.5 Rupiah) (Reporting by Alfian; Editing by Neil Chatterjee,sourced:Thomson Reuters)
(sourced:Thomson Reuters)
Tags:Indonesia coal news, Indonesia coal policy, government regulating coal pricing, state coal utility, PT Perusahaan Listrik Negara(PLN), negotiations, coal producers in Indonesia, agreement, suppliers, Bumi Resources, PT Tambang Batubara Bukit Asam, Kaltim Prima Coal, Indonesia coal benchmark price, thermal coal prices,
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