PT Resource Alam Indonesia Tbk (KKGI) plans to expand into the nickel mining business.This was realized with the acquisition of two nickel companies, PT Buton Mineral Indonesia (BMI) and PT Bira Mineral Nusantara (BMN).
Just so you know, on January 15, 2021, KKGI made a sale and purchase agreement for the new company’s shares amounting to 70% of the shares of PT BMI and PT BMN with a transaction value of Rp 175 million each.The purchase of shares of the two companies was carried out in preparation for KKGI to expand into the nickel mining business.
KKGI management ensures that the acquisition of PT BMI and PT BMN is not a material transaction.”The transaction funds we carry out come from internal cash,” added Corporate Secretary of Resources Alam Indonesia Lenny SC, Friday (22/1).
The nickel mining business is promising in line with the soaring commodity prices.In addition, the downstream industry which utilizes nickel as raw material also continues to grow.Then, it is possible that KKGI will look for opportunities to develop the nickel downstream business.However, KKGI has not been able to disclose in detail about the plan.”We are still in the initial assessment for the smelter business and cannot provide further information,” said Lenny.
Furthermore, for now the coal mining business is still KKGI’s main focus.Until the end of 2020, Lenny said that KKGI’s coal production had reached 2.89 million tons.This amount is in accordance with the coal production target set by KKGI since the beginning of last year.
As for this year, KKGI management targets to produce 4 million tons of coal.This figure includes sales of the domestic market obligation (DMO) of 25% of total production.
This production target can be achieved thanks to the complete and adequate capacity of heavy equipment and overall infrastructure, additional new production from several blocks, readjustment of striping ration according to market conditions, and additional sales to the domestic market.
For information, KKGI scored a decrease in sales of 29.40% (yoy) to US $ 57.13 million per quarter III-2020.In the same period, KKGI suffered a net loss of US $ 7.51 million.