Jakarta, December 4, 2020 – As an effort to
increase productivity of heavy equipment in its mining operations, PT Darma
Henwa Tbk (DEWA) signed a 5 year Total Tyre Management (TTM) Agreement with the
largest tyre manufacturer in China, Fujian Haian Rubber Co. Ltd. This agreement
was signed by the Vice President Director of Darma Henwa, Mr. Prabhakaran Balasubramanian
and the Director of Fujian Haian Rubber, Mr. Zhitang Chen, on 25 November 2020.
Under the TTM Agreement, Fujian Haian
Rubber, through its subsidiary PT Luan Tyre Indonesia, will provide all the tyre
needs for heavy equipment at Darma Henwa’s coal mining projects in Bengalon,
East Kalimantan, Asam Asam and Satui-Senakin in South Kalimantan. TTM will include procuring, fitting and
maintenance of tyres, and regular training on optimal tyre use, wear and tear for
Darma Henwa’s operators, and monitoring their operational efficiencies.
With tyres contributing to almost 30%
of the maintenance costs, through this TTM, Fujian Haian will standardise unit tyre
costs and reduce the cost burden on Darma Henwa. Tyre supply and maintenance from
Fujian Haian will have a unique actual monthly operation-based payment
mechanism of US$/BCM/KM.
This TTM arrangement will have several
benefits for Darma Henwa. First is that it is of minimal risk, since the
payment will be made reflecting the actual usage and distributed on a per BCM
basis. Second, this achieves a
significant reduction in capital as well as operating costs with no inventory to
maintain and an undivided focus on maximizing productivity. Third, Fujian Haian Rubber will supervise
daily operations hands on to make more suitable tyres specific for site
conditions and strive for continuous improvement. There will be experienced professionals
who are tasked with maintaining tyres to ensure safety and efficient productivity
while being transparent on costs.
Finally, it ensures timely supply of tyre needs without lost time in
operation and production.
"TTM is the key to managing tyre
costs as part of our maintenance budget.
With this collaboration, we can now totally devote our focus on
productivity. As a result, the Company's volumes will increase and ultimately
contribute to the increase in revenue and profits, while effectively managing
our costs. We are indeed excited about
teaming up with Fujian Haian Rubber in achieving our goal to be the most cost
effective mining services provider in Indonesia" said Vice President
Director and Chief Executive Officer of Darma Henwa, Mr. Prabhakaran
Regarding the performance, until the end of
October 2020, overburden removal at Bengalon coal mine was recorded at 66.55
million BCM, Asam Asam coal mine at 17.50 million BCM and the Satui coal mine at
11.37 million BCM. For coal production, Bengalon project recorded 7.68 million
tonnes, Asam Asam project amounted to 5.95 million tonnes and Satui project at
0.6 million tonnes.