Chevron’s Future in Rokan Block: Gross Split & Jonan
Ignasius Jonan, minister of energy & mineral resources, is famous for his communication style. Some see him cocky. He used strong words. When Freeport threatened to take Indonesia to the court of arbitration, Jonan said the US company was just too fussy. “I thought Freeport is an elephant…turned out it’s just a cow,” he said in February.
Sinar Jaya Agro Investama & Expansion of Plantation
The benchmark November 2017 contracts of crude palm oil (CPO) advanced RM44 to RM2873 per ton Wednesday (Sept 13), while December 2017 and January 2018 contracts ended higher by RM35 and RM28 to RM2847 and RM2828 per ton respectively. As predicted, we’ve seen more transactions in the palm oil industry.
Domestic Coal Pricing Formula
Shares of coal producers listed on Indonesia Stock Exchange (IDX) were severely hit by suggestion from state electricity provider PT Perusahaan Listrik Negara (PLN) to apply cost+margin in the formula of coal price for domestic market obligation (DMO).
Commodities & The Economy
The Central Bureau of Statistics (BPS) is scheduled to release August 2017 export-import data on Friday (Sept 15). Most indicators suggest commodities as key driver of export growth, which might continue in the remaining months of 2017. While manufacturing and tourism might be future growth sectors, commodities would remain important for Indonesian economy during the transition in the coming years.
Friendlier Policies
Ministry of energy and mineral resources will soon issue a decree related to partnership between state-owned oil and gas company Pertamina with other investors in the Mahakam Offshore Block, the largest gas producing block in the country. The decree basically gives Pertamina flexibility in farm-out its ownership in the block.
Revisiting Kencana Agri Ltd
Kencana Agri Limited, one of the plantation groups listed on SGX with operations in Indonesia, is among top losers this year despite improvements in its bottom line. With earning per share of US$0.0396 in the first half, the stock is now traded with PE multiple 2.7 only on its annualized earnings.
Merger & Acquisition Update: Plantation
The benchmark November 2017 contracts of crude palm oil (FCPO) ended lower by RM16 to RM2766 per ton Friday (Sept 8). Outlook remains weak on anticipated higher output in Indonesia and ample of supply from competing soybean oil.
Coal Journal: Prices & Shares
Shares of coal producers listed on Indonesia Stock Exchange (IDX) ended mostly higher grounds Friday (Sep 8) as thermal coal returned to around US$98 per ton, thanks to positive news from United States and China. Indika Energy (INDY) led the rally with 11% gain, while its coal mining contracting subsidiary Petrosea advanced 9.7%.
Mining Recovery: Capex and Labour Market
Thermal coal retreated to US$95.8 per ton Monday (Sep 4), but still representing nearly 38% gain year-on-year. Copper, meanwhile, closed at US$3.09 per pound last Friday to represent nearly 50% gain year-on-year. Nickel has also returned to above US$12,000 per ton after more than two years of correction.
Aneka Tambang Yet to See the Light, How Much Longer Must You Wait?
Aneka Tambang (ANTM), state miner with interest in gold, bauxite-alumina, nickel, and coal, booked net loss of Rp496.12 billion in the first half of 2017 against profit of Rp11 billion in the corresponding period last year due to a combination of higher equity in losses from associated entity/joint venture and finance costs.