It is good to see that you went back and re read the announcment. Yes it is as you said. A portion of the coal is paid for once it hits the stockpile and the balance is paid for after the barges are loaded. I would hope that the management negotiated that enough was paid for once it hit the port stockpile to enable them to mine all year round. This is the way I took it anyway and I am pretty sure that is what it is.
What this means is that KRL is able to continue mining and paying all the contractors during the dry season as well as continue mining without having to worry about cash crunches.
And yes I do know what FOB barge means. In regards to spot charters yes it is the ideal way to shift coal but in Kalimantan it is VERY hard to get a spot charter to go so far up the mahakam. The spot charters are more frequent down the river out to Mother vessels.
And it looks as if people do not understand the importance of the 300,000 tonne contract. This is very good for KRL and also beneficial for BAyan. They are able to lock in the supply of the high quality coal and shift it when they need to. They understand the rise and fall of the river as they have another project in not too far away I think.
KRL Price at posting:
12.5¢ Sentiment: ST Buy Disclosure: Held
