Indonesia temporarily shuts Thai Lanna coal unit ops

Fri Dec 19, 2008 6:08am EST  

JAKARTA, Dec 19 (Reuters) - Indonesia has ordered a unit of Thai coal miner and ethanol producer Lanna Resources PCL LANN.BK to temporarily halt coal production after it was found to be in violation of mining operation rules, an energy and mines official said on Friday. 

PT Lanna Harita Indonesia, which operates a coal mine in East Kalimantan, did not reclaim idle mining pits, causing one of the pits to break down during the wet season and flood nearby a village, said MS Marpaung, a director at the energy and mines ministry. 

"They should do reclamation on idle mining pits but they didn't. They didn't exercise good mining practice," Marpaung said. 

"As the head of mining inspection, we have the authority to close down the mine until they can improve it," he said. 

The ministry ordered the firm to halt its coal production early this month and gave it three months to do reclamation on its idle mining pits before it could resume production, Marpaung said. 

Officials from Thai Lanna and PT Lanna Harita Indonesia could not be reached immediately for comment. 

Despite temporarily shutting down on production, the firm will still be allowed to export coal which had been collected in stockpile, Marpaung said. 

Lanna Resources owns 55 percent of PT Lanna Harita Indonesia (LHI), the firm said in its website. 

It has mineable reserves estimated at 15 million tonnes with annual production of 1.5 million tonnes. (Reporting by Fitri Wulandari, editing by Ben Tan)