China-US Trade War Forces INDY to Diversify

PT Indika Energy Tbk (INDY) will not reduce its 35.5 million tons production target. Leonardus Herwindo, INDY’s head of corporate communications, quoted by kontan.co.id, revealed that the decision is final although the company’s performance much depends on the unreliable coal price. The number comes from Kideco Jaya Agung’s and of Multi Tambangjaya Utama’s production target at 34 and 1.5 million tons respectively.

The company has performed many improvements to keep the production volume at a desirable level in the second half of 2019. For example, INDY encourages its sub-holding companies to increase their synchronization level. The company also cuts unnecessary expenses to decrease inefficiencies and tries to diversify to non-coal-based businesses by investing in the gold-mining industry through one of its sub-holding companies, Indika Mineral Investindo. The sub-holding company recently signed a subscription agreement with Nusantara Resources Limited, a gold-mining company.