Cokal’s JV Partner Secures A$238m to Boost Coal Transport and Production
Cokal’s joint venture partner PT Petrindo has secured significant financing to develop its metallurgical coal mine and shared infrastructure, promising enhanced transport capacity and cost efficiencies for Cokal’s BBM project.
- PT Petrindo raises IDR 2.4 trillion (A$237.8m) for mine and infrastructure development
- Joint venture enables co-development and sharing of coal transport infrastructure
- Two successful BBM metallurgical coal shipments to China completed
- Infrastructure upgrades expected to reduce coal delivery costs per tonne
- Mohing Bridge construction 90% complete despite weather delays
Strategic Financing Secured for Regional Coal Development
In a pivotal development for Cokal Limited (ASX: CKA), its infrastructure joint venture partner PT Petrindo Jaya Kreasi Tbk (IDX:CUAN) has secured IDR 2.4 trillion (approximately A$237.8 million) in bank financing. This capital injection is earmarked for the advancement of PT Petrindo’s PT DBK metallurgical coal mine in Central Kalimantan, Indonesia, alongside critical coal transport infrastructure.
The proximity of PT DBK to Cokal’s BBM project underpins a strategic collaboration formalised in 2024, where both companies jointly develop and share coal transport infrastructure. This arrangement is designed to maximise transport capacity and operational efficiencies, accelerating production ramp-up at BBM while significantly lowering costs per tonne.
Operational Progress and Market Deliveries
Cokal has already demonstrated tangible progress, completing two shipments of BBM metallurgical coal to China, including a pilot co-load shipment with MUTU, a PT Petrindo group company. A third shipment is scheduled for early February 2025 to PT Mareta Persada, another group affiliate, reinforcing the deepening strategic ties within the joint venture ecosystem.
Infrastructure development continues apace despite some weather-related delays. The Mohing Bridge, a critical link in the haul road from BBM Pit 3 to KM 52, is now 90% complete with handover expected mid-February 2025. Upgrades to the Batu Tuhup Jetty approach have also been substantial, improving haul truck operations and supporting the growing coal transport demands.
Leadership Perspectives on Value Creation
Cokal Chairman Domenic Martino highlighted the significance of PT Petrindo’s financing milestone, noting it unlocks major regional infrastructure upgrades that will add considerable value to Cokal’s operations. CEO Karan Bangur emphasised that these developments not only enable a substantial expansion of production targets but also promise a meaningful reduction in delivery costs, positioning Cokal for cash flow positivity even amid challenging market conditions.
The joint venture’s synergy, combining aligned objectives and geographic proximity, offers a compelling platform for future value-adding alliances beyond infrastructure sharing. This collaborative approach could well serve as a blueprint for operational efficiency in the metallurgical coal sector.
Looking Ahead
As PT Petrindo advances its mine development and infrastructure projects, the market will be watching closely to assess the impact on Cokal’s production capacity and cost structure. The successful integration of these assets and the realisation of operational synergies will be critical to sustaining momentum and delivering shareholder value.
Bottom Line?
PT Petrindo’s financing breakthrough sets the stage for Cokal’s accelerated growth and cost leadership in metallurgical coal.
Questions in the middle?
- How will ongoing infrastructure upgrades affect Cokal’s production timelines and cost targets?
- What risks remain around construction delays or regulatory hurdles in Central Kalimantan?
- Could the joint venture expand into other value-adding collaborations beyond transport infrastructure?
