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June 6, 2012

Reswara Secures Additional Coal Sales Contract in China

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PT Reswara Minergi Hartama (Reswara), an integrated coal company and subsidiary of ABM Investama (IDX: ABMM) has secured a coal sales contract of 500,000 metric tons with Guangzhou Huaneng Trading Co., Ltd with estimation of delivery period in June to December 2012 period. The contract was signed on Monday (6/4) in Bali by the Director of PT Tunas Inti Abadi (TIA), a subsidiary of Reswara, represented by Mr. Feriwan Sinatra and Director of the Guangzhou Huaneng Trading Co., Ltd, Li Mei Xing.

Guangzhou Huaneng Trading Co., Ltd. is an importing coal company from Indonesia to China since 2010, and operates in line with growing demand for coal in China. Coal from the sales contracts with Reswara will be used to supply two power companies in the area of Guangdong, China.

The contract with Guangzhou Huaneng Trading Co.., Ltd. is Reswara’s fourth contract in 2012. Coal is produced by TIA from the concession area in South Kalimantan with the trade name TIA Compliant Coal (TCC).

With this contract, Reswara has managed to secure four contracts for coal sales amounting to 3.8 million metric tons or 68% of the total company’s sales target for 2012 of 5.5 million metric tons.

"We are delighted to secure up to 68% of the sales target in the middle of this year, amidst the slowdown of demand in the past few months. Having said this, we are still optimistic that demand for coal, as one of the main substitutes for crude oil, will continue to rise in the longer term,” said President Director of Reswara Minergi Hartama Harry Asmar.

Electricity demands have risen significantly in the past ten years, particularly in Asia in line with the growing population and public welfare. Coal is one of the main fuels for power plants in Asia, particularly China and India, which consumes almost half of the world’s total coal production. Currently, 70 percent of electricity in India and 80 percent in China are sustained by coal-powered power plants.

Harry Asmar added, "Our focus this year is to ensure that business development proceeds according to plan, both for the implementation of operational excellence in TIA as well as the start of construction for MDB infrastructure in Aceh. With a target of increasing production on a yearly basis as well as the relative proximity of our mines to the port, we are optimistic Reswara will be one of the low-calorie coal suppliers most sought after by Asian exporters."