Arutmin Indonesia, a subsidiary of coal miner Bumi Resources, and Japanese steel manufacturer Kobe Steel are jointly constructing a smelter that will transform brown coal into higher-quality coal.
It would cost $150 million to build a smelter able to process a million tons of low-grade coal a year into higher-grade coal. The smelter with a capacity of one million to two million tons a year appeared economical.
The smelter, to be built at Tanah Bumbu in South Kalimantan, should be finished by next July. A second facility is planned for South Sumatra. Both plants are being built in response to a new government rule banning exports of low-rank coal starting in 2014.
The smelter would be Indonesia’s first brown coal upgrade facility. It would be able to increase the calorie of coal from 4,500 kilo-calories per kilogram to 6,100 kilo-calories per kilogram.
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