Ir. Palgunadi Tatit Setyawan Independent Commissioner Theodore Permadi Rachmat Vice President Commissioner Edwin Soeryadjaya President Commissioner Ir. Subianto Commissioner Lim Soon Huat Commissioner

26 Adaro Energy Annual Report 2009 From Us to Y ou Running Adaro Management Report Owning Adaro Governing Adaro Financial Report Contact Us Corporate Social Responsibility Adaro in Summary www.adaro.com Letter from the Board of Commissioners

4. Ir. Palgunadi Tatit Setyawan Independent Commissioner

1. Theodore Permadi Rachmat Vice President Commissioner

3. Edwin Soeryadjaya President Commissioner

5. Ir. Subianto Commissioner

2. Lim Soon Huat Commissioner

From Left to Right: Adaro Energy Annual Report 2009 27 www.adaro.com Dear Shareholders, Last year our report described luctuating and uncertain global markets and highlighted our core business focus. Twelve months on, I am pleased to conirm we are on track with many investment project initiatives to build a bigger and better Adaro. We are making exceptional progress and our efforts can be seen in our year end results. Remarkable Results Along with the improving global economy and commodity markets in the second half of 2009, Adaro was able to achieve excellent inancial results. In many ways 2009 was a challenge particularly during the irst half of the year where the global economies in many countries were still in a recession and there was reduced demand for Adaro’s coal. However, the recovery of the global economies in the second half of 2009 have turned around the demand for energy, which resulted in the increasing demand for Adaro’s coal. We closed the year with slightly higher production and sales volumes of 5.5 and 1 respectively. However, in terms of revenue we achieved remarkable results where our revenue increased by 48.89 to Rp26.9 trillion from Rp18.1 trillion a year ago. We booked a Net Proit of Rp4.4 trillion, up by 392.25 from last year. Meanwhile, our EBITDA Earnings Before Interest, Taxes, Depreciation and Amortization rose substantially by 147 to Rp11.0 trillion, illustrating our robust core business growth. Adaro is currently Indonesia’s second largest thermal coal producer, with a present capacity of approximately 48 million metric tonnes per year and is executing plans to further increase its annual production capacity. Adaro is continuing to make infrastructure and other improvements along the coal supply chain to improve eficiencies and strengthen its distinctive position in the market. We believe that owning a part of each of the critical pieces of the supply chain will ultimately reduce costs, lower risks, increase lexibility of production, enhance control of transportation and improve reliability. At the end of 2009, contractors for the OLC were selected and we expect the project to commence soon with estimated completion and subsequent commissioning in early 2012. We have also continued to make progress in the construction of the 2x30 MW mine mouth coal-ired power plant as preparatory work continued at the site. Upon the completion of this power facility, it will provide power to the OLC, mining operations as well as 1.5 MW of free power for the local community. In the Annual General Meeting of Shareholders AGMS on June 3, 2009, the Company reported the use of IPO’s proceeds from July 14, 2008 to May 29, 2009 amounted to Rp11.85 trillion net of expenses. A inal dividend of Rp11.8 per share or 42.5 of Net Proit was also approved by the shareholders at the AGMS and distributed in September 2009. Subsequently, the Board of Commissioners and Board of Directors also approved the interim dividend distribution in 2009 of Rp12 per share based on September 2009 inancial, which was distributed in December 2009. Letter from the Board of Commissioners 28 Adaro Energy Annual Report 2009 From Us to Y ou Running Adaro Management Report Owning Adaro Governing Adaro Financial Report Contact Us Corporate Social Responsibility Adaro in Summary www.adaro.com Letter from the Board of Commissioners CSR, Governance and Compliance As a publicly listed mining and energy company, good corporate governance goes hand-in-hand with our Corporate Social Responsibility CSR. Our commitment to support the local communities and preserve the environment in which we operate has also been demonstrated in the past, and continue to deine our business practices and methods. As part of our commitment to further integrate with the community and create more sustainable development programs, we established Adaro Bangun Negeri foundation in April 2009. This social foundation will receive on-going support from Adaro to develop economic, social, educational and health programs for the surrounding communities during and after Adaro’s operations. Going forward, we expect that Adaro Bangun Negeri foundation will spearhead all the social functions and community development programs of Adaro. In addition to the community programs, Adaro recognizes that coal mining will have an impact to the surrounding environment and local communities and applies strict standards on all phases of its operations through an Environmental Policy and Master Plan to ensure that negative impacts are minimized. Land affected by mining is reclaimed as soon as possible and made available to the local community. The reclamation includes planting of commercial crops, creating ish farms and developing recreational areas. Continuous monitoring of air and water quality as well as strict programs for air, water and waste handling and control are an integral part of the environmental program with an extensive range of equipment to handle all aspects of monitoring and analysis. Our efforts and commitment in sustaining best environmental practices have yielded notable success. We were pleased to receive the PROPER Green award for 2 consecutive years from the Ministry of Environment for excellence in environmental rehabilitation and social programs. In line with our increased responsibility as a listed Company, we have met the statutory requirements of the capital market and bourse authorities, and continue to build our governance structure in line with best practices. This includes the establishment of the Audit Committee and the Internal Audit Unit in January 2009, and there are plans to form a Nomination and Remuneration Committees as well as a Risk Management Committee in the near future. The Board of Commissioners has continued in its governance role to oversee all key aspects of business operations of Adaro via the mechanisms of regular board meetings and ad hoc meetings as well as the work of the Audit Committee. Although there is room for improvement in our governance structure, we believe Adaro has made extensive progress in advancing towards best practices and standards in alignment with Adaro’s stated objectives, vision and mission. Adaro Energy Annual Report 2009 29 www.adaro.com Furthermore, as a law abiding corporate citizen, we were also pleased to receive an award from the government in May 2009 for being one of the largest tax payers in the country. We will always strive to seek better ways to govern ourselves. We believe good corporate governance should be more than just a set of procedures or policies that comply with prevailing rules and regulations. Most importantly good corporate governance should be practiced and become an inherent part of our business or better put, as a way of life. It is our intention to develop good corporate governance as a perpetual system that ensures the interests of both our shareholders and stakeholders are safeguarded and to ensure the Company’s sustainability. Our solid control and investments in the coal supply chain coupled with best-in-class human resources have placed us in an ideal position to beneit from the country’s potential economic growth. Through discipline and hard work, Adaro is positioned strategically to seize and capitalize on opportunities in the energy and commodity markets. The progress and the results we achieved during the year would not have been possible without the strong support of our customers and partners, and the commitment, dedication and hard work of the Board of Directors, management and staff. As a closing remark, I would like to extend my heartfelt thanks to all of our stakeholders who have supported our endeavors in 2009, and count on their continuing trust and support to ensure our sustainable growth in years to come. On behalf of the Board of Commissioners, Edwin Soeryadjaya | President Commissioner Letter from the Board of Commissioners 30 Adaro Energy Annual Report 2009 From Us to Y ou Running Adaro Management Report Owning Adaro Governing Adaro Financial Report Contact Us Corporate Social Responsibility Adaro in Summary www.adaro.com Letter from the Board of Directors

4. Alastair Grant Director of Marketing