u r p
r o
F Il
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u r
M E
SSA g
E S
o u
r B u
S In
E S
S
o u
r pE
o pl
E
o u
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o v
Ern A
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M un
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S o
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T o
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DAro EnErgy 2013 AnnuAl rEporT
55
sustainable value from Indonesian coal. In 2013, AI recorded a lost time injury frequency rate lTIFr
of 0.16 compared to 0.28 in 2012, better than our target of 0.25. We had 10 lost time injuries lTIs,
a 44 improvement from 18 lTIs in 2012. With a total of 62,060,850 work hours, we went 6.3 million
hours without a single accident. We had no lTIs in December 2013, an exemplary safety performance.
Coal Mining
2013 was our best year of production with 52.3Mt of thermal coal mined and hauled, an
11 increase. Strong customer demand, normal weather conditions and good performance by the
contractors combined to help attain our record results. our contractors performed at a high level,
with 145,680 tonnes mined daily on average from all three pits.
Tutupan remains our main mine, producing 38.65Mt in 2013, relatively lat year-on-year.
production from Wara was 7.87Mt in 2013, a 3 increase, while paringin grew by more than ive
previously, four contractors worked in the tutupan pit, while three contractors split the work in Wara
and paringin pits. Starting in 2013, we have two contractors working in tutupan, two contractors
in Wara and one contractor in paringin. this allowed for better co-ordination in each pit, thereby
improving productivity. We will also negotiate mining contracting rates to be more competitive
for 2014.
In addition to the new annual production record of 52.3Mt, AI and its contractors also achieved a
quarterly production record of 13.73Mt in 3Q13, as well as a daily coal-hauling record of 187,331 tonnes
in December 2013. the following table shows the breakdown of overburden removal, and coal
mining and hauling activities of our contractors as a percentage of the company’s total in 2013. Having a
number of contractors helps us obtain good results in terms of cost and performance.
Safety is always a top priority. Safe and reliable operations create trust with our partners, which
is important to achieve our objective of creating
Million bank
cubic meters
2003 2004
2005 2006
56.1 66.0
85.6 122.8
119.9 159.3
208.5 225.9
299.3
22.5 24.3
36.1 42.2
26.7 38.5
47.7
34.4 40.6
47.2 52.3
2007 2008
2009 2010
2011 2012
2013
300 350
200 250
150
100
50
10- yea
r comp oun
d a nnual
gr ow
th r ate
C AG
R o f 9
Leveraged buyout of Adaro
Start of US and European
financial crises
331.5 294.9
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56
IABlE, STrong, EFFICIEnT
times to 5.74Mt from 0.94Mt in 2012 as the demand for our premium E5000 product was strong during
the year.
Overburden Removal and Strip Ratio. We reduced our actual strip ratio in 2013 by 19 to 5.64x, lower
than the average planned strip ratio of 5.75x set at the beginning of the year. We removed 294.86Mbcm
of overburden in 2013, an 11 decrease, which was near our target of 305Mbcm. We were able to
lower our strip ratio without affecting our long- term mine plan due to investments to increase
overburden removal during the higher coal price environment in 2011 and 2012. Furthermore, this
lower-than-average planned strip ratio remained higher than the life-of-mine strip ratio. Average daily
overburden stripping for 2013 was 823,170 tonnes.
AI Use of Mining Contractors 2013
40
PAMA
36
PAMA
15
BUMA
12
BUMA
9
RA
13
RA
1
RMI
2
RMI
35
SIS
37
SIS
Coal mining and hauling
Overburden excavating
and disposal
Rainfall at the Tutupan Mining Area in 2013
Left scale: Rainfall in mm Right scale: Rain days
2013 2013
5-year average 5-year average
600 mm
25 Days
500 20
400 15
300 10
100 200
5
F A
A o
J D
J J
M S
M n
Key pAMA: pamapersada nusantara
SIS: Saptaindra Sejati BuMA: Bukit Makmur Mandiri
rA: rahman Abdijaya rMI: rante Mutiara Insani
Rainfall and Pit De-watering. In 2013, we had a total rainfall of 2,265mm, 32 lower compared to the
ive-year average, and a total of 189 rain days, 5 higher compared to the ive-year average. normal
weather patterns during the year assisted in our record production achievement.
Coal Hauling and Barging
Hauling.
During the year, road maintenance and upgrades continued to minimize cycle time, increase
unit productivity and reduce fuel consumption. these efforts resulted in a new daily coal hauling record of
187,331 tonnes on December 18, 2013, which is 8.5 higher than the previous record set in 2012.
to further improve productivity and decrease cycle time along our hauling road, we constructed
a coal trailer terminal at Kelanis to reduce queuing time. At the end of 2013, there were 358 double-
trailer sets in operation.
Coal Processing and Barge Loading.
operations at Kelanis, which handles all coal-crushing,
stockpiling and barge-loading, maintained a high level of availability throughout the year.
During the year, we completed the irst stage of the upgrade at Kelanis, increasing its capacity
to 60Mt annually based on average operating conditions. We continue to undertake the detailed
planning for the second upgrade that will bring its total capacity to 70Mt per year. see page 71
for details. to spend prudently and to ensure eficiency, we upgrade Kelanis in stages. the
continuous upgrade program allows AI to increase production without experiencing any bottleneck in
infrastructure.
Marine Logistics
We barge our coal either to transhipment facilities located at the taboneo offshore anchorage or pt
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Indonesia Bulk Terminal’s IBT South pulau laut Coal Terminal for the export market, or via direct
barge shipment to domestic customers. At the end of 2013, we had 55 sets of tugs and barges serving
AI, with an average capacity of 12,063dwt, a 2.7 increase over 2012’s average of 11,750dwt.
In 2013, we did most of our ship-loading activities at Taboneo anchorage which accounted
for 66 of our total tonnage, relatively lat y-o-y. In addition, we directly barged 18 of our total
tonnage to domestic customers, 11 were loaded using self-geared vessels at Taboneo, and 5
through our IBT terminal.
AI employs four barging and three ship-loading contractors including our subsidiary, MBp. MBp
handled the largest volume for AI during the year, accommodating 50 of barging activities and 61
of ship-loading activities. In 2013, the average barge cycle time was 104 hours while the average vessel
waiting time was 2.2 days.
In March 2013, pT Adaro logistics was tasked with managing and co-ordinating the logistics arm
of our coal supply chain, including marine logistics. See the following section for details.
During the year, road maintenance and upgrades continued to minimize
cycle time, increase unit productivity and reduce fuel consumption. These
efforts resulted in a new daily coal hauling record.
AIs coal is barged down the Barito
River. Most is loaded direct to customers
ships at the Taboneo anchorage offshore.
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IABlE, STrong, EFFICIEnT
PT Saptaindra Sejati SIS
SIS is one of Indonesia’s leading mining contractors. It develops mining infrastructure and offers mining
services for AI and other customers. Across all of its customers, SIS recorded 8
higher coal mining volume to 26.5Mt in 2013, mainly due to AIs increased coal production. SISs
overburden removal declined by 15 to 163.5Mbcm in 2013, as AI reduced its planned stripping ratio
from 6.4 bcmt in 2012 to 5.75 bcmt in 2013. SIS achieved a coal production CAgr of 32 and 28
CAgr for overburden removal over a 9-year period.
The subdued coal prices in 2013 affected SIS’s operations, as its customers reduced overburden
removal and coal production. SIS decided at the start of 2013 not to extend its contract with two
customers due to this reason. AI remains SIS’s largest customer, and in 2013 accounted for
approximately 63 of its overburden removal and 74 of its coal mining. SIS expects to further
Subsidiaries in Our Coal Supply Chain A Model of Vertical Integration
SIS 5-Year Highlights
2009 2010
2011 2012
2013 Key Financial Highlights US million
Total Assets 461.0
482.8 564.3
618.1 534.1
Total Liabilities 362.8
381.9 449.4
487.9 404.8
Interest Bearing Debt 311.5
309.3 362.1
399.4 337.9
Total Equity 98.2
101.0 115.0
130.2 129.3
Revenue
264.3 304.5
424.7 494.6
410.3
Operating Statistics
Overburden Removal Mbcm 115.0
128.1 167.6
192.5 163.5
Coal Getting Mt 16.4
16.6 22.2
24.5 26.5
increase its role within AI’s operations and will gradually increase its contribution to AI. Beside
AI, SIS also serves third-party customers, as well as our other mining project, Balangan Coal.
As of the end of 2013, SIS owned more than 1,300 units of heavy equipment, including
400-tonne excavators and 250-tonne haul trucks, giving SIS an annual capacity of 30Mt. SIS did not
invest in any heavy equipment in 2013 as it had adequate capacity. However, SIS plans to spend
approximately uS95 million to replace its older equipment in 2014.
In line with AE’s improved focus on cost discipline and productivity throughout 2013,
SIS focused on enhancing the utilization of its current leet, improving the competency of its
workforce in performing maintenance programs at competitive costs and ensuring customer
satisfaction.
In terms of safety, SIS recorded an lTIFr of 0.1 with no fatalities, and has developed an education
program to improve safety performance.
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PT Adaro Logistics AL
In March 2013, Al was tasked with managing and co-ordinating the logistics arm of our coal supply
chain, which includes coal barging and ship-loading, channel dredging, and the maintenance, stevedoring,
and the port operations at the Taboneo offshore anchorage and IBT’s South pulau laut onshore port.
It aims to be reliable, eficient and the best-managed Indonesian logistics company, with high-quality
occupational health and safety standards and environmental best practices.
Al focuses on providing an integrated port-to- port logistics supply chain that ensures reliable and
eficient coal delivery to more than 50 customers in 12 countries. By having all the various units under
one roof, Al is able to identify synergies among them to better utilize the resources within the Ae group.
In 2013, Al inaugurated its subsidiary, pt Indonesia Multi purpose terminal IMpt, and the operations of
MBp’s new loating transfer unit Ftu.
PT Maritim Barito Perkasa MBP
MBp is AI’s main contractor for transporting coal from Kelanis to the offshore anchorage at taboneo
or IBt’s South pulau laut port. It also handles direct shipment to domestic customers. Beside AI,
MBp also serves third-party customers.
MBp operates a total of 38 barge sets, 15 of which are chartered from third-party vendors, and
four units of self-propelled barges. It has a barging capacity of 318,000 DWt, equivalent to 30.5 million
tonnes of carrying capacity if the entire leet were to barge to taboneo. In 2013, MBp invested uS33.1
million to expand its leet with ive units of 15,000 DWt capacity barges and ive units of 3,200 BHp
tugs.
In 2013, MBp transported 27.36Mt of coal, 21.6 higher compared to 2012, of which 95 25.8Mt
was from AI. Aside from coal barging, MBp also carries out ship-loading activities at taboneo
offshore anchorage. MBp’s ship-loading facilities at taboneo consist of four loating cranes with a
combined annual capacity of 19Mt and one new loating transfer unit Ftu with an annual capacity
of 21Mt. the Ftu, which started operations in July 2013, has a design capacity of approximately 60,000
tonnes per day, or four times the average loating crane capacity.
In 2013, 16.2Mt of coal were loaded to ships through four loating cranes, 4 higher than the
previous year. the Ftu contributed 4.6Mt from July to December 2013. In total, 20.8Mt of coal
was loaded, 33.5 more than 2012’s 15.6Mt. MBp has consistently increased its barging and ship-
loading volumes as well as its contribution to AI’s operations.
MBP 5-Year Highlights
2009 2010
2011 2012
2013 Key Financial Highlights US million
Total assets
189.2 129.6
152.9 221.4
244.3 Total liabilities
162.7 139.2
139.8 170.6
153.0 Interest-bearing debt
0.1 0.1
130.6 156.0
141.6 Total equity
26.5 9.6
13.1 50.8
91.3 Net revenues
