Indonesia Mining 2012 - GBR

Mining IN Indonesia
few coal services providers that has experience
in port management. The changing legal
framework has presented MBSS with an
opportunity and caused a fundamental shift
in the business. “In 2010 MBSS provided
services focused more on the short distance
side, but starting in 2011 we transported
more from long distance, from port to
port, mainly from Kalimantan to Java. This
means that in terms of volume the growth
is perhaps not much, but rate and revenue
will double. The nature of our services have
changed as a result of the domestic market
obligation which requires the coal mining
producer to sell within the domestic market,
so there is more of a demand of coal
transport around Indonesia itself,” said Ika
Bethari, director MBSS.
The shift has been a positive move as
growth at MBSS has been strong. “Since
2010, out of the 250 million mt of coal produced,
MBSS transported 25 million mt, so
our market share is about 10% of total coal
production. That figure excludes domestic
obligation for coal sold and purchased inside
Indonesia. This year, the target is to
have 350 million mt of Indonesian coal
produced, and so in line with that increase
MBSS would like to transport 38 million mt.
Our market share will increase only slightly,
not because we do not feel that the Indonesian
coal space is lucrative and promising
in Indonesia, but because last year we expanded
our fleet aggressively from 47 barging
fleets last year to 73, nearly doubling in
size. MBSS needs to consolidate this growth
from an operational point of view; growth is
good but only if we can maintain our bottom
line at the same level,” said Bethari.
Welding
Telling of the increasing technical difficulty
of mining operations in Indonesia is the utilization
of more advanced equipment. Further
indicative of this trend, are the companies
that have emerged for the purpose of
maintaining and servicing these new technologies.
One such company is PT Sanggar
Sarana Baja (PT SSB) , a company engaged
in manufacturing parts, on-site maintenance,
and provision of components. That
being said, PT SSB’s main expertise is in
welding. SSB’s welders can weld 6G and
also titanium type of metals which carries
with it a significant level of difficulty. “PT
SSB is the only Indonesian company to
reach U3 (by ASME) standard which was
granted in December last year,” said Satya
Heragandhi, President Director, PT SSB.
Riding the wave of optimism felt throughout
much of the country, PT SSB has set
high goals for the future, and are aiming
to grow three times faster than the national
economy’s annual growth rate, which
stood at 6.5% in 2011. Over the last year
PT SSB built facilities in Kalimantan and
expanded into Papua and has significant
plans of expansion for the years to come
as they predict that the mining boom will
continue. Nevertheless, for Herangandhi
and SSB, the success of the company will
require that the PT SSB’s management look
beyond the near future. “It is not about the
short term target, it’s also about building a
solid foundation for the future. Many foreign
companies are trying to enter the market,
but many also make the same mistake by
thinking that they can apply the knowledge
that they have from other markets on to Indonesia,
but it is not that easy to overcome
cultural difference.”
It is often wrongfully assumed that local
Indonesian companies do not possess the
facilities or expertise required for welding.
Fortunately, local companies, like PT SSB,
are making this assumption a thing of the
past. “We are there for companies seeking
a good partner with a faultless record and
solid credibility, which is not an easy thing
to do as a local company in Indonesia. We
keep the spirit of integrity alive at all times;
it’s our core value and we are very proud of
it,” said Heragandhi.
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