09 November 2017
SGX’s Indonesia-Focused Coal Plays Average 50.7% Gain YTD
  • SGX’s three Indonesia-focused coal miners – Golden Energy and Resources, Geo Energy Resources and BlackGold Natural Resources – have averaged a price gain of 50.7% in the 2017 YTD, as Indonesia’s benchmark coal price surged to a 10-month high.
  • In October, Indonesia's reference coal price, known as Harga Batubara Acuan (HBA), jumped 2.1% month-on-month to US$93.99 per metric tonne, after soaring 9.6% month-on-month in September, according to data from the country's Ministry of Energy and Mineral Resources. HBA is now at its highest since December 2016.
  • Coal is expected to remain a vital source in meeting Indonesia's growing domestic electrification needs. In 2015, Indonesian President Widodo unveiled an ambitious 35,000 MW program to boost the country's electrification ratio to 97% by 2019, with about 25,000 MW of capacity expected to come from coal-fired power plants.

Singapore Exchange lists four thermal coal miners – Golden Energy and Resources (GEAR), Geo Energy Resources, BlackGold Natural Resources and Resources Prima Group.


GEAR, Geo Energy and BlackGold mine thermal coal, also known as steam coal, which is used for power and heat generation. Their mining operations are conducted in Indonesia, and all companies report in US dollars.


Also listed on SGX are companies involved in downstream coal activities, such as trading and distribution. They include Noble Group, Abterra and Manhattan Resources.


The three listed Indonesia-focused coal miners GEAR, Geo Energy and BlackGold have averaged a price change of 50.7% in the 2017 year-to-date and 29.6% in the last 12 months.


Singapore’s Energy Sector (by Company Count)


Source: Bloomberg, (data as of 8 November 2017)

Companies are classified by their MSCI Global Industry Classification Standard (GICS®) Sub-Industries


The three coal mining stocks have a combined market capitalisation of S$1.6 billion. Together, they account for 26% of Singapore’s Energy Sector, which has a market capitalisation of S$6.2 billion. At the end of October 2017, the Energy sector had a YTD market capitalisation weighted total return of 8%, ranking it third amongst Singapore’s Defensive sectors. To read more about the YTD performance of Singapore’s other sectors, click here.


A Vital Energy Source in Indonesia and the Region


Indonesia was ranked the fifth largest producer of coal in the world in 2016, after China, US, Australia and India, data from BP Statistical Review of World Energy 2017 showed. By 2005, Indonesia had overtaken Australia as the largest exporter of thermal coal, with its position in Southeast Asia enabling the country to meet China and India’s fast-growing appetites.


Coal is also expected to remain a vital source in meeting Indonesia's growing domestic electrification needs, as urbanisation and an expanding middle class boost demand across the archipelago. In 2015, Indonesian President Joko Widodo unveiled an ambitious 35,000-megawatt (MW) program to boost the country's electrification ratio to 97% by 2019, with about 25,000 MW of capacity expected to come from coal-fired power plants.


Indonesia’s Coal Prices Surge in the Past Year


In October, Indonesia's benchmark coal price jumped 2.1% month-on-month to US$93.99 per metric tonne, after soaring 9.6% month-on-month in September, according to data from the country's Ministry of Energy and Mineral Resources. The reference coal price, also referred to as Harga Batubara Acuan (HBA), is now at its highest since December 2016.


The average HBA price so far in 2017 stands at US$84.22 per tonne, up significantly from an average US$61.84 per tonne in 2016, according to data from Indonesia Investments.


Harga Batubara Acuan (US$)

Source: Bloomberg, (data as of 8 November 2017)


The table below details the three listed coal mining plays, sorted by market capitalisation. Click on the stock name to visit its profile page on StockFacts.


SGX Code

Market Cap S$M

Last Price*

Total Return YTD %

Price Change YTD %

Price Change 1 Yr %

P/E (x)

P/B (x)

Dvd Ind Yld %

Golden Energy & Resources










Geo Energy Resources










Blackgold Natural Resources




















Source: Bloomberg & SGX StockFacts (data as of 8 November 2017). *Last price of companies are denoted in their respective trading currencies. **Price Change from IPO date on 12 Dec 2016
Note: GEAR, Geo Energy and BlackGold are traded, while Resources Prima Group is suspended from trading.


Company Details


Golden Energy and Resources (GEAR)


Background: GEAR was formed through the completion of the reverse takeover of Mainboard-listed United Fiber System. The Group is principally engaged in the exploration, mining, and marketing of thermal coal sourced from its coal mining concession areas, covering an aggregate of approximately 42,904 hectares in South and Central Kalimantan, Jambi and South Sumatra Basin, Indonesia.


Latest Quarterly Results: For the second quarter ended 30 June 2017, GEAR swung to a net attributable profit of US$11.8 million from a net attributable loss of US$1.17 million in the year-ago period, while revenue rose 54.9% YoY to US$139.6 million.


Company Outlook: In its 2QFY17 results statement, GEAR noted that coal demand in its key export markets of China and India remained robust in the first half of 2017, and the Indonesian government’s electrification programme to add 35,000 megawatts in power generation capacity across the country by 2019 also continues to drive demand growth. In the current operating landscape, GEAR believes it is well-positioned to capture opportunities from increased coal demand with its raised production capacity and the established branding of its BIB 4,000-4,200 GAR coal.


Geo Energy Resources


Background: Geo Energy’s operations are primarily located in Indonesia. Geo Energy is a coal mining specialist with an established track record in the operation of coal mining sites for the purpose of coal production and coal sales since 2008. It now owns major mining concessions and coal mines in East and South Kalimantan, Indonesia with JORC coal reserves of over 90 million tonnes.


Latest Quarterly Results: For the three months ended 30 June 2017, Geo Energy reported a 136% YoY jump in net profit from continuing operations to US$10.0 million, while revenue gained 176% to US$58.9 million.


Company Outlook: Geo Energy noted in its results statement that the Group expects a higher volume of coal sales for the second half of 2017 given better weather conditions. Demand for Indonesian’s high-calorific, low-sulphur and low-ash coal in the region continues to rise due to the potential tightening of rules by Chinese government on low-quality, high-ash coal imports, in line with its strict environmental initiatives. As most countries head into winter season, the Group expects demand from inventory stocking to gather pace during the July- October period, which in turn should sustain or boost current coal prices.


Geo Energy is constantly exploring opportunities to acquire additional coal mining concessions to complement its portfolio of assets. The Group is also exploring opportunities to divest stakes in its coal mining concessions as a means to collaborate with strategic partners and raise capital, it added.


To read the kopi-C profile of Geo Energy CEO Tung Kum Hon, click here.


BlackGold Natural Resources


Background: BlackGold is a coal mining company targeting Indonesia's rapidly growing power plant industry. It is focused on long-term, fixed offtake agreements and has a customer portfolio comprising state-owned and independent power plants and factories. The Group holds the rights to three coal concessions in Sumatra – PT Samantaka Batubara, PT Ausindo Andalas Mandiri, and PT Ausindo Prima Andalas, which span more than 45,550 hectares in combined acreage. The company has, to-date, explored a total area of about 10,000 hectares in the PT Samantaka Batubara concession.


Coal Reserves: As of June 2017, coal reserves at the PT Samantaka Batubara concession have more than tripled from last-reported estimates announced in August 2016, according to the latest Independent Qualified Person's Report (IQPR) prepared by BlackGold's independent consultant, PT GMT Indonesia.


Latest Quarterly Results: For the second quarter ended 30 June 2017, BlackGold reported a net attributable loss of US$1.82 million, versus a net attributable loss of US$976,000 in the year-ago period. Revenue surged to US$1.0 million from US$158,000 in the year-earlier quarter.


Company Outlook: BlackGold noted in its results statement that barring unforeseen circumstances, the gradual ramp-up of coal deliveries to its customers, combined with the continued dominance of coal in the development of domestic Indonesian power generation, would position the Group for further growth.


To read the kopi-C profile of BlackGold CEO Philip Rickard, click here.


Coal Mining Risks


The minerals industry offers investors opportunities for substantial investment returns as well as the possibility of losses. The key sources of risk and reward are exploration, technical, financial, environmental, social, political, and sovereign issues. A comprehensive investor’s guide to the terminology and reporting standards can be found here.


Exploration by its very nature is a risky investment because there are no guarantees that a company exploring for minerals will find anything of value. For most minerals, exploration is expensive and the consequence of a failed exploration program is a financial loss. Exploration success discovering a new mineral deposit or finding additional mineralisation at an existing mine generates an asset that adds value to a company. Small companies with limited financial resources are relatively high risk/reward investment options because they cannot survive many failed exploration programs. However, they may generate large investment rewards if they are successful in exploration.


Did You Know?


The SGX Listing Rules for mining plays recognise a number of national industry reporting standards. Typically, these reports will include the technical basis on which statements of reserves, resources or exploration results are made.

The three industry codes recognised by the SGX Listing Rules are:

  • Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code)
  • National Instrument NI 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) from Canada
  • Pan European Reserves and Resources Reporting Committee Code for the Reporting of Exploration Results, Mineral Resources and Pre Reserves (PERC Code)

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