BRMS suffers $58m loss

JAKARTA. Publicly listed coal miner PT Bumi Resources Minerals (BRMS) suffered US$58 million in losses last year in what it called a “one time loss and write off” following the sale of its overseas projects, as the company shifted focus to Indonesian assets.

“Such a write off and loss were only booked as a one time transaction in nature and they were somewhat necessary to allow us to focus more on developing our Indonesian assets more efficiently going forward,” BRMS CEO Suseno Kramadibrata said in a press statement published on Thursday.

BRMS last year diluted its ownership in the Liberia mining project in West Africa to only 5 percent and divested its iron ore projects in Mauritania, West Africa to the local partner, Rubis International Limited.

“Consequently, BRMS is no longer exposed to the risks of dealing with uncertain regulations in foreign countries,” Suseno added.

BRMS has booked losses for two consecutive years after it closed 2012 in the red with $29.72 million net losses.

Suseno, however, still said progress had been made. “Operationally, we have accomplished some notable progress in our projects throughout the year of 2013.”

BRMS last year signed an agreement with China Non Ferrous Metal Industry’s Foreign Engineering & Construction Co Ltd. to develop and monetize the zinc and lead project in Dairi Prima Mineral, North
Sumatra.

The company is developing 292 million ton ore resources from PT Gorontalo Minerals’ Cabang Kiri and Sungai Mak sites.

“Such a development is intended to increase copper and gold resources and reserves from existing and new sites in the near future,” the press statement read.

Gorontalo Minerals and PT Nusantara Smelting recently signed a memorandum of understanding (MoU) so that the former could supply copper concentrates to a smelting and refining facility that will be constructed by the latter.

“Such an MoU would allow us to focus on the upstream business of the mining industry, while at the same time, we outsource refining and smelting activities to an expert,” Suseno explained.

BRMS is a non-coal unit of coal mining giant PT Bumi Resources (BUMI). BUMI has recently secured approval from its shareholders to sell its 42 percent stake in BRMS, worth about $257.4 million, to Chinese wealth fund China Investment Corporation (CIC) in a debt-to-equity swap deal.

BUMI finance director Andrew Beckham said on Thursday that the company expected to complete the debt settlement this month.

“[The process of the settlement] is all up to the government, the Investment Coordinating Board [BKPM] and the Financial Services Authority [OJK],” Andrew told reporters after a shareholders meeting, which agreed on the three agendas required to seal the deal with CIC.

Shares in BRMS traded at Rp 235 apiece on Thursday’s trading close, up 4.91 percent from the previous day. (Esther Samboh)