SET-listed Banpu Plc, Asean's leading coal miner, is likely to cut its planned capital expenditure this year and next by US$150 million from $779 million by postponing and adjusting investment projects in Australia and Mongolia, says chief executive Chanin Vongkusolkit.
In Australia, Banpu moved machinery from its Newstand mine to the Myuna project earlier this month, which should increase production output at Myuna by 300,000 tonnes to 2.1 million tonnes a year. Banpu scrapped its plan to produce high-cost coking coal at Newstand, reducing its planned investment of $197 million for 2014-15 by about $100 million.
Banpu's five-year investment plan through 2015 allotted $779 million to be spent this year and next, with 40% allocated to its coal-fired Hongsa power plant in Laos, said Mr Chanin.
Also, its investment plan in Mongolia has changed and the capital required till 2015 will be halved to $50 million. Major investment in Mongolia might resume some time between 2016-17, he said.
Banpu's 1,800-megawatt Hongsa project is developing according to plan, with the first unit covering 600 MW scheduled to become operational in June of 2015, and the second and third units slated for September 2015 and February 2016.
The company is in talks to develop a mine-mouth power plant at Gaohe coal mine with local partners in China, with a capacity of 1,200 MW.
Chief operating officer Voravudhi Linananda said Banpu studied the possibility of developing a solar power project in Japan, China and Thailand. Investment in Japan is likely to be finalised early next year.
"The solar production cost has declined, but available land in Japan is a challenge, as not many solar projects are in operation there," said Mr Voravudhi.
Mr Chanin said Banpu aims to achieve its coal production target of 48.8 million tonnes this year, up from 45.8 million in 2013, of which 30 million tonnes would come from Indonesian mines, 15.6 million from Australia, and 3.2 million from China. In the first six months, it sold 25.5 million tonnes, with 16.2 million from Indonesia and 8.6 million from Australia.
Banpu's average selling price is projected to slip to $70 per tonne in 2014 from $72 last year. In the first half, it fell 9% year-on-year to $68.1 per tonne from $77.1, as global coal prices dipped.
Banpu expected flat revenue of 108 billion baht this year. First-half revenue dipped 8% year-on-year to 50.45 billion, but net profit rose 112% to 2.48 billion.
Shares of BANPU closed yesterday on the SET at 32.75 baht, up 50 satang, in trade worth 483 million baht.