Jonan & Masela Block
President Jokowi has on Thursday (Oct 20) given clear instructions to newly appointed energy and mineral resources minister Ignasius Jonan about the development of Masela Block in Maluku province. The President asked Jonan to speed up development of the block, which has been delayed for years due to policy changes and other issues.
Medco Energi: Long Way to Go
Shares of Medco Energi (MEDC), which recently acquired gold and copper miner PT Newmont Nusa Tenggara, closed higher by 1.91% to Rp1335 Thursday (Oct 20). At this price, MEDC only has market cap of Rp4.45 trillion or US$342 million, not even half of its equity.
Metals & Steel Industry
Steel is among the best performing product with almost 50% gain in the past 12 months or so. This contributed to rally in iron ore prices, which advanced almost 5% this month and 11.3% since October 2015. Tin, zinc, and lead also followed with double digit gains in the period, but copper lost ground.
Restriction for Investments in Nickel (and other Mineral) Smelters
Compared to other minerals (iron, bauxite, and copper), nickel has attracted lots of investments in smelting facilities in the past few years. Consistency in implementing nickel ore export ban and crackdown by the new government in the Philippines for environmental concerns might benefit Indonesia in the long run, especially if metal prices recover.
Signs of Recovery in Commodities Market
BHP Billiton produced 7 million tons of thermal coal in the quarter ended Sept 30, 2016, down 4% from the corresponding quarter last year, but grew 9% from the previous quarter. The Company, considered the largest mining company in the world, sees early signs of recovery in commodities market.
Aneka Tambang: Ironies…
State miner Aneka Tambang (ANTM) has on Thursday, Oct 13, signed memorandum of understanding with PT Bank ICBC Indonesia regarding US$1.5 billion financing cooperation. The financing may consist short-term loans, working capital, and long-term loan facilities to support ANTM’s investments, acquisitions, new plants, and distribution network.
Coal & China Factor
Shares of coal producers and mining contractors gained significantly in the past few trading days. Trading volume has also increased substantially including in the troubled company Bumi Resources (BUMI) and debt-ridden Delta Dunia Makmur (DOID). Reports from China might continue to support the sector for quite sometime.
Speculations on Kangean Block
Kangean block in East Java is one of the largest gas producing fields in the country, feeding manufacturing and power generation companies in the area. It is co-owned by Mitubishi Corp, Japan Petroleum Exploration (Japex) Ltd, and Energi Mega Persada (ENRG)—-member of Bakrie Group.
Rumours on Apexindo & Elnusa
Apexindo Pratama (APEX), an oil and gas supporting services company, suffered net loss of US$7.35 million in the first half of 2016 as sales revenues collapsed 51.2% to US$71.3 million. Elnusa (ELSA), another supporting services company, on the other hand, booked net profit of Rp145 billion, an increase of 9.2% from the same period of 2015, while sales revenues slipped only by 5.1% to Rp1.71 trillion (US$132 million).
Rally of Commodities
Shares of palm oil producers opened mixed in the region Wednesday (Oct 12) despite 3% gain of crude palm oil (CPO) in the futures market Tuesday. Felda and Sime Darby down 0.85% and 0.38% respectively in Kuala Lumpur, while First Resources lost 0.8% in Singapore. In Jakarta, most plantation shares were in green, but modest gains.